Solar Energy Corporation of India LimitedA Government of India Enterprise

Schedule-A Central Public Sector Undertaking

Presentation Structure

1. Introduction to SECI

2. Government initiatives for promoting RE

4. SECI competitive bidding for RE

3. SECI initiatives for development of RE

1. Introduction to SECI

About SECI :

➢ Incorporated on 20th September 2011 (not for profit)

➢ Converted into a Commercial Company on 9th Nov, 2015

➢ Scope covers all forms of Renewable Energy

➢ Authorised share capital: Rs. 2000 Cr.

➢ Paid up share capital: Rs. 354 Cr.

➢ Debt-free company

➢ Category I (highest) Power Trading Licensee by CERC

➢ Dividend paying company since 2015-16

Business Areas :

8

SECI activities

Projects(Own)

MNRE Schemes

PMCOff-grid systems

ConsultingPower Trading

• Solar, Wind, hybrid, energy storage tenders

• Schemes for Rooftop solar

• Solar parks

• CPSU scheme

• Upcoming technologies: Off-shore wind

• 100 MW completed

• 450 MW under implementation

• Major clients: PSUs and Govt. agencies

• Traded 16+ BU of electricity from solar and wind projects

• Solar street lights, Lanterns, home lighting systems

• Assisting Village Electrification under DDUGJY

• 11 MW commissioned• 10 MW under execution• Over 450 MW under due-

diligence in floating solar, energy storage technologies

• Technical and financial due diligence, Feasibility studies, Detailed project reports, Resource assessment etc.

2. Govt. initiatives to promote RE

Initiatives to achieve RE target

• Renewable Purchase Obligation (RPO) trajectory declared forup to 2022;

• Waiver of Inter State Transmission System charges and lossesfor solar and wind power for projects commissioned till March,2022;

• Standard guidelines for procurement of solar/wind powerthrough tariff based competitive bidding process issued.

• Technical Standards for Solar/Wind PV systems notified

• New Initiatives such as Floating Solar, Solar Wind hybrid,Domestic Manufacturing, Energy Storage etc.

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❑ Solar Park Scheme - Target: 50 solar parks, 40000 MW

❑ VGF Scheme – Commissioned: 5200 MW, Now no VGFrequired

❑ CPSU scheme:- Target: 13000 MW, Allocated: 2908 MW,Commissioned: 881 MW

❑ Bundling Scheme:- Capacity: 3000 MW, Commissioned:2950 MW

❑ Rooftop Scheme, Canal Bank and Canal Top Scheme,Defence Scheme

❑ Off-grid schemes- Solar Pumps, Street Lights, Home Lights, Study Lamps, Small Solar Power plants

8

Major existing Schemes for Solar Sector

3. SECI initiatives for development of RE

Large-Scale Solar Projects:

• Central Implementing agency for large-scale tenders for

Solar Energy

• Tendered capacity: 48

GW,

• Capacity awarded:

18.3 GW,

• Commissioned

projects: 5.3 GW

Large-Scale Wind and Hybrid Projects

• Central Implementing agency

for large-scale tenders for

Wind and Solar-Wind Hybrid

technologies

• 12.6 GW tendered,

• 9.4 GW awarded,

• 1.7 GW commissioned

• Hybrid: 4 GW tendered, 1.4

GW awarded

Innovative tenders by SECI:

• Solar PV Projects in Leh and Kargil Districts, Jammu & Kashmir

7.5 GW

• ISTS Connected Solar PV project linked with 2 GW (per Annum) Solar Manufacturing Facility with Green-Shoe option

7 GW

• ISTS Connected Solar PV projects (ISTS-VII) with Peak Power Supply for 6 hours (off-peak hour tariff-2.88, peak hour tariff to be discovered)

1.2 GW

• RTC power (availability factor of 85% , tariff to be discovered which shall be escalated 4% annually upto 15 years)

0.4 GW

Project Management Consultancy

• Undertaking project management

consultancy for solar projects on

turnkey basis

• Major clients: Govt. agencies/

PSUs

• 100 MW capacity commissioned

• 400+ MW under implementation

Projects through own Investment

• 160 MW solar-wind-battery hybrid project in Andhra Pradesh

• 150 MW Floating solar project in Jharkhand

• 200 MW Floating solar project in Uttarakhand

• 100 MW Solar + Storage project in Chhattisgarh

• Diesel replacement project in Lakshadweep

• 11 MW of solar projects under

commercial operation (Rajasthan,

A&N)

• 10 MW under execution (Karnataka)

• Upcoming projects:

Rooftop solar and off-grid systems

• Implementing agency for tendersunder MNRE subsidy/incentiveschemes

• 647 MW awarded, 350+ MW

commissioned

• PMC- 5.76 MW commissioned for GAIL, 8 MW for BHU isunder execution

• CAPEX- 1 MW in Andaman & Nicobar

• Decentralised systems- lanterns, home lighting systems,streetlights etc.

Solar Parks:

Objective:

The aims to provide a huge impetus to solar energy generation by actingas a flagship demonstration facility to• encourage project developers and investors,• prompting additional projects of similar nature,• triggering economies of scale for cost-reductions,• technical improvements and achieving large scale reductions in

greenhouse gas (GHG) emissions.

“The solar park is a concentrated zone of development of solarpower generation projects and provides developers an area that iswell characterized, with proper infrastructure and access toamenities and where the risk of the projects can be minimized.Solar Park will also facilitate developers by reducing the number ofrequired approvals.”

Solar Parks

• Implementing MNRE scheme for setting up of solar parks indifferent states (23499 MW)

• Solar Parks in 6 states being set up through JV of SECI with Stateagencies:

• Andhra Pradesh Solar Power Corporation Limited

• Karnataka Solar Power Development Corporation PrivateLimited

• Lucknow Solar Power Development Corporation Limited

• Renewable Power Corporation of Kerala Limited

• Rewa Ultra Mega Solar Limited

• Himachal Renewables Limited

• Over 10 GW of parks under implementation through JVs

Solar Parks in India:

Progress of solar parks:

a) Total solar parks: 35+

b) Solar parks cover states like Andhra Pradesh,

Rajasthan, Gujarat, Tamil Nadu, Karnataka, Madhya

Pradesh, Kerala, Odisha, Maharashtra, Uttar Pradesh,

West Bengal, Jharkhand, Arunachal Pradesh, Manipur,

Meghalaya, Mizoram, Nagaland etc.

c) Total Project Capacity: 22879 MW

d) Project Commissioned Capacity: 7030 MW

e) Projects under execution: 3015 MW

f) Projects under Tendering: 3725 MW

g) Total Project Capacity to be tendered/ under DPR: 9109

MW

4. Competitive bidding process and selection process

Key tender provisions for B-O-O Projects

Project scope & RfS overview

Projects to be implemented under the Build-Own-Operate (BOO) basis.Successful bidders to be selected through a competitive e-bidding,followed by e-Reverse Auction process

Scope of the developer includes setting up of Solar/Wind/HybridPower Projects along with implementation of power evacuation andtransmission infrastructure, up to the Interconnection Point.

Power to be purchased by SECI at the tariff discovered, and is sold toBuying Utilities at discovered tariffs, with an additional tradingmargin being levied by SECI.

Bidding and reverse auction carried out on VGF/tariff/both being theparameters. Average Term of Agreements: 25 years

Key tender provisions for B-O-O Projects

Major RfS provisions

Cumulative project capacity to be awarded to a single Company including itsParent, Affiliate or Ultimate Parent-or any Group Company. Min. & max. limitsfixed depending on tender capacity

Bid submission deadline generally fixed at about 45 days from the date of issuanceof tender documents

Financial Closure to be achieved within 12 months from the Effective Date of PPA

Commissioning deadline: 18 months from the Effective Date of PPA

Bidders to meet the General and financial eligibility criteria as per provisions of RfS

Bidders to submit cost of RfS document (fixed irrespective of quoted capacity)and bid processing fee (based on no. of projects quoted for)

EMD: upto 2% of the estimated Project cost

PBG: upto 5% of the estimated Project cost

Key tender provisions for B-O-O Projects

General Eligibility Criteria

• “Companies” as defined under Companies Act 2013, or respective

national laws (in case of foreign bidders) are eligible.

• Consortium also allowed (No JVs), with one member acting as the Lead

Member, to carry out bid submission on behalf of consortium. In this case,

financial eligibility criteria required to be met in line with the equity

commitment ratio as declared in Consortium Agreement.

• In case of foreign bidders as well as Consortia, it is mandatory to

incorporate a Company in India under Companies Act, 2013, as an SPV.

Multiple SPVs can be incorporated for multiple Projects. Agreements are

signed with the SPVs.

• Indian bidders can also execute Projects through SPVs in case of award of

Projects.

Key tender provisions for B-O-O Projects

Financial Eligibility Criteria

• Net-worth: Minimum Net-worth required @ 20% of the total estimated

project cost of the cumulative capacity quoted.

• Liquidity: Bidder shall be required to demonstrate at least one of the

following parameters:

• Minimum annual turnover @INR 6 million/MW (wind &

hybrid)/@INR 5million/MW (solar) of the total quoted capacity.

• Minimum PBDIT amount @ INR 1.2 million/MW (wind &

hybrid)/@INR 1 million/MW (solar) of the total quoted capacity.

• Line of Credit for a minimum amount @ INR 1.5 million/MW (wind &

hybrid)/@INR 1.25 million/MW (solar) of the total quoted capacity.

• Above parameters to be met as on the last date of previous Financial Year

Key tender provisions for B-O-O Projects

Plant Performance• CUF to be declared at the time of bid submission, may be revised once in

the 1st year of COD (for solar/hybrid) & once within first 3 years of COD

(for wind)

• Minimum CUF quoted should be 17% (solar), 22% (wind), 30% (hybrid)

• Performance criteria

• Specify a range within which deviations from the quoted CUF is

allowed, without any penalty. Takes into account the degradation

factor in case of Solar Projects.

• Shortfall in generation to be levied penalty as per provisions of RfS

• Generation compensation to be provided in case of offtake constraints on

account of transmission constraint, Grid unavailability and backdown

• Excess generation and early commissioned power to be purchased @ 75%

of the PPA tariff

Key tender provisions for B-O-O Projects

Project Commissioning

Scheduled Commissioning Date (SCD): 18 months from Effective Date of PPA.

Project declared as “fully commissioned” when the entire rated capacityhas been installed and power flows into the grid.

Part commissioning allowed for min.50% of the Contracted Capacity.Project to be commissioned in line with commissioning guidelines issuedby SECI.

Liquidated Damages: PBGs to be encashed until the first six months (solar)/nine months (wind/hybrid) from the SCD, on pro-rata basis, proportionateto the capacity not commissioned.

In case of further delay, PPA stands terminated limited to the capacitycommissioned until the above deadline including liquidated damages.

Selection Process: Bid evaluation

Step 3

Shortlisting of bidders for reverse auction

Step 2

Financial Bid EvaluationFirst round Tariff of the technocommercially qualified bidders evaluatedand ranking done on ascending order.

Step 1

Techno commercial evaluation of the bidders

Shortlisting Process: Eligibility for e-RA

SE

(i) In case ST <1200 MW, SE = 0.8 X ST

(ii) In case ST ≥ 1200 MW, SE = 0.8 X ST, subject to maximum eligible capacity being tender capacity

n = {

If (T-m) is even m+(T-m)/2, if Sm≥ SEWhere m =Total number of techno-

commercially qualified bidders (after

ranking is done in ascending order

from L1 onwards) such that (Sm-1 < SE

MW and Sm ≥ SE) and 1≤m≤TIf (T-m) is odd m+(T-m+1)/2, if Sm ≥ SE

• Bidders provided opportunity to reduce tariffs/VGF• Elimination of bidders prior to e-RA: competitive First round tariffs/VGF

Example

• T= Total techno-commercially shortlisted bidders • ST = Total bid capacity of techno-commercially shortlisted bidders • SE =Eligible capacity for award• n=Total eligible bidders for e-Reverse Auction

Shortlisting Process: Eligibility for e-RA

Example-continue.. If (T-m) is even

Sl.No.

Techno commercially

qualified Bidder

Rank Capacity (MW)

Cumulative Capacity

(MW)

T m SE n Shortlisted Bidders for e-

RA

1 B3 L1 250 250 10 8 1200 MW*

9** B3

2 B5 L2 200 450 B5

3 B1 L3 300 750 B1

4 B4 L3 100 850 B4

5 B2 L4 50 900 B2

6 B6 L5 70 970 B6

7 B7 L6 80 1050 B7

8 B8 L7 240 1290 B8

9 B9 L8 450 1740 B9

10 B10 L9 600 2340

*SE=0.8x2340=1872, subject to maximum tender capacity i.e. 1200 MW**n=8+(10-8)/2=9 as per above formula

Shortlisting Process: Eligibility for e-RA

Example-continue.. If (T-m) is odd

Sl.No.

Techno commercially

qualified Bidder

Rank Capacity (MW)

Cumulative Capacity

(MW)

T m SE n Shortlisted Bidders for e-

RA

1 B3 L1 250 250 10 9 1200 MW*

10** B3

2 B5 L2 200 450 B5

3 B1 L3 300 750 B1

4 B4 L3 100 850 B4

5 B2 L4 50 900 B2

6 B6 L5 70 970 B6

7 B7 L6 80 1050 B7

8 B8 L7 100 1150 B8

9 B9 L8 540 1690 B9

10 B10 L9 650 2340 B10

*SE=0.8x2340=1872, subject to maximum tender capacity i.e. 1200 MW**n=9+(10-9+1)/2=10 as per above formula

Shortlisting Process: Eligibility for e-RA

Example-continue.. If (T-m) is odd

Sl.No.

Techno commercially

qualified Bidder

Rank Capacity (MW)

Cumulative Capacity

(MW)

T m SE n Shortlisted Bidders for e-

RA

1 B3 L1 250 250 11 8 1200 MW*

10** B3

2 B5 L2 200 450 B5

3 B1 L3 300 750 B1

4 B4 L3 100 850 B4

5 B2 L4 50 900 B2

6 B6 L5 70 970 B6

7 B7 L6 80 1050 B7

8 B8 L7 240 1290 B8

9 B9 L8 450 1740 B9

10 B10 L9 600 2340 B10

11 B11 L10 200 2540

*SE=0.8x2540=2032, subject to maximum tender capacity i.e. 1200 MW**n=8+(11-8+1)/2=10 as per above formula

Shortlisting Process: Eligibility for e-RA

Example-continue.. If (T-m) is even

Sl.No.

Techno commercially

qualified Bidder

Rank Capacity (MW)

Cumulative Capacity

(MW)

T m SE n Shortlisted Bidders for e-

RA

1 B3 L1 250 250 11 7 1200 MW*

9** B3

2 B5 L2 200 450 B5

3 B1 L3 300 750 B1

4 B4 L3 100 850 B4

5 B2 L4 50 900 B2

6 B6 L5 70 970 B6

7 B7 L6 240 1210 B7

8 B8 L7 100 1310 B8

9 B9 L8 350 1660 B9

10 B10 L9 140 1800 B10

11 B11 L10 200 2000

*SE=0.8x2000=1600, subject to maximum tender capacity i.e. 1200 MW**n=7+(11-7)/2=9 as per above formula

Selection Process: e-Reverse Auction

Reverse Auction: Conducted on an independent portal- live & transparent

process.

Bidders can improve their ranking by quoting revising their last quoted

tariff/VGF by any number of decrements. No revision allowed in quoted

capacity.

Bucket filling process: L1 bidder allotted its quoted project capacity, the next

higher bidder allotted its quoted capacity and process continues till total

capacity is exhausted.

Time stamping of bids as tie-breaker: In case of tie, among two or more

bidders, they are considered in the chronological order of their last bid with

preference to that bidder who has quoted his last bid earlier than others.

Transparent process

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e-RA results: Pseudo identities e-RA results: Names of bidders

2000 MW ISTS-connected Wind Power Projects (Tranche-III)

Case study: Bhadla Solar Parks

• Total capacity of 750 MW divided into 2 Solar Parks in Rajasthan:500 MW (Phase-III) and 250 MW (Phase-IV).

• Each Park divided into 5 Projects: 5X100 MW and 5X50 MW

• Provided opportunities to everyone-’large’ companies as well as ‘smaller’players, they could quote for a single Project or for the entire Parks: Resultedin aggressive bidding

• The e-RA for 250 MW was held before that for 500 MW.• The period between above 2 auctions was kept just sufficient to give bidders

time to analyze and rework based on the discovered tariff.• Limited time between the auctions effectively ruled out possibility of

cartelization.

• Bids that were submitted on 19/04/2017 had their e-RA conducted on09/05/2017 (in just 19 days), which created ripples in the market.

• e-RA for 250 MW Bhadla Phase-IV Park:• Began at the tariff of INR 3.93/kWh at 14:00 Hrs on 09/05/2017• Non-stop 9.5 hours’ session-closed at 23:30 PM on 09/05/2017• Resulted in a record low fixed tariff of INR 2.62/kWh (US Cents 4.05/kWh).

• e-RA for 500 MW Bhadla Phase-III Park• Began at the tariff of INR 3.93/kWh at 14:00 Hrs on 11/05/2017• Non-stop 20 hours’ marathon session, closed at 10:00 Hrs. on 12/05/2017• Resulted in lowest ever fixed tariff of INR 2.44/kWh (US Cents 3.78/kWh).

• Highlight: None of the bidders shortlisted for e-RA opted for VGF, although it was part ofthe tender.

• Unprecedented market response:• 250 MW Park-27 bidders with 3250 MW bid capacity (oversubscribed by 13 times)• 500 MW Park-24 bidders with 5500 MW bid capacity (oversubscribed by 11 times)• Participation from several international players, including SoftBank (Japan), Phelan

Energy (South Africa), EDF Energy (UK), Solairedirect(France), Alfanar (Saudi Arabia),etc

Bhadla Solar Parks: Historic results

Results for Bhadla Phase-III

Bidder's NameBidder's Quantity (MW)

Tariff (INR/kWh)Awarded capacity (MW)

ACME Solar Holdings Private Limited 200 2.44 200

SBG Cleantech One Limited 500 2.45 300

Hero Solar Energy Private Limited 300 2.46 ---

ReNew Solar Power Private Limited 500 2.47 ---

Avaada Power Private Limited 200 2.60 ---

Shapoorji Pallonji Infrastructure Capital Company Pvt. Ltd.

400 2.65 ---

RattanIndia Solar 3 Private Limited 100 2.87 ---

Duroc Solar Private Limited 100 2.88 ---

Orange Renewable Power Private Limited

200 2.95 ---

Lightsource Renewable Energy Holdings Limited

100 2.98 ---

Solairedirect Energy India Private Limited

300 3.08 ---

Mahoba Solar (UP) Private Limited 300 3.14 ---

Aditya Birla Renewables Limited 200 3.18 ---

Results for Bhadla Phase-IV

Bidder's NameBidder's Quantity (MW)

Tariff (INR/kWh)Awarded capacity (MW)

Phelan Energy Group Ltd 50 2.62 50.00

Avaada Power Private Limited 100 2.62 100.00

SBG Cleantech Three Limited 250 2.63 100.00

Mahoba Solar (UP) Private Limited 250 2.71 ---

ReNew Solar Power Private Limited 250 2.74 ---

Natems Power Private Limited 50 2.75 ---

Azure Power Forty Five Pvt. Ltd. 100 2.80 ---

Mira Zavas Private Limited 50 2.92 ---

Cambronne Solar Private Limited 50 2.94 ---

Orange Renewable Power Private Limited

50 3.00 ---

IL&FS Energy Development Company Limited

50 3.12 ---

ACME Solar Holdings Private Limited 50 3.36 ---

RattanIndia Solar 4 Private Limited 50 3.37 ---

Mahindra Renewables Private Limited

100 3.59 ---

Key highlights/Learning

Fall in solar tariffs, a result of combination of various factors, most importantbeing the GoI’s initiative to cover solar/wind power procurement by SECIunder the ambit of Tripartite Agreement- Payment Security Mechanism

Other factors include: higher CUF in Rajasthan, drop in module prices ininternational market, strengthening of Indian rupee against US dollar,innovative financing methods adopted by successful bidders.

SECI’s Contract Agreements-considered bankable by international lendingagencies- low capital cost, long tenure capital flow, attracting first timeinternational players and investors in the Indian market.

Every possibility of the above success being replicated in other countries, ifsuch innovations are adopted. No. of market players, business environment ofthe country, order booking position of the key players along with extensivemarket research play key roles, depending on each country

Thank You