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MoP Amends TBCB Guidelines for Wind Power Projects

The Ministry of Power (MoP) amended Tariff-Based Competitive Bidding (TBCB) guidelines for procurement of power from grid-connected wind power projects, introducing location-specific bids, new financial instruments, stricter CUF compliance, and faster PPA timelines to enhance transparency and accelerate renewable energy deployment.

February 20, 2025. By EI News Network

The Ministry of Power (MoP) has introduced significant amendments to the guidelines for the Tariff-Based Competitive Bidding (TBCB) process for the procurement of power from grid-connected wind power projects.

These modifications aim to enhance transparency, ensure better compliance, and accelerate the implementation of wind energy projects in India.

The new guidelines include several key changes. A new clause (4.3) allows procurers to specify the substations in the Inter-State Transmission System (ISTS) or Intra-State Transmission System (InSTS) where wind power projects must connect, improving grid management and easing integration.

Additionally, the guidelines have revised the minimum Capacity Utilisation Factor (CUF) obligation (Clause 6.6(b)), making it mandatory for wind power generators to maintain their declared CUF for two consecutive years (excluding the first contract year ending on March 31 after the project’s commissioning date). If a generator fails to meet this requirement, they must pay lump-sum damages equivalent to 24 months’ tariff or the balance PPA period, whichever is lower. If these damages remain unpaid, the Power Purchase Agreement (PPA) may be terminated, further obligating the generator to pay the procurer damages equivalent to the same amount.

The definition of Change in Law (Clause 6.7) has also been updated to align with the Electricity (Timely Recovery of Costs due to Change in Law) Rules, 2021, and future amendments. Any legal change affecting a project occurring within seven days prior to the bid submission will now qualify as a Change in Law event, allowing cost adjustments.

Technical criteria (Clause 8.2.1) for project developers have been made more stringent to ensure better competition and project execution. Developers are required to install GPS-enabled Automatic Weather Stations (AWS) to share real-time data with the Load Dispatch Centres in compliance with the Indian Electricity Grid Code. Furthermore, developers must comply with cybersecurity regulations as mandated by central government authorities, ensuring protection against potential cyber threats.

The amendments also address delays in signing agreements. Under Clause 10.3, the PPA and Power Sale Agreement (PSA) (if applicable) must be signed within 30 days from issuing the Letter of Award (LoA). This period can be extended up to 12 months, beyond which the LoA will be cancelled, ensuring timely project implementation.

Additionally, under Clause 11.4, distribution licensees must approach the Appropriate Commission within 30 days of tariff discovery for formal tariff adoption, expediting regulatory approvals. To ease the financial burden on developers, the guidelines introduce new instruments for Earnest Money Deposit (EMD) and Performance Bank Guarantee (PBG) under Clauses 12.1(a1) and 12.2(a1).

Developers can now provide Insurance Surety Bonds or other instruments approved under the General Financial Rules (GFR), offering greater financial flexibility. Moreover, Clause 12.3 permits encashing PBGs to recover any damages or dues, if the generator defaults under the PPA. These recovered amounts will be credited to the Payment Security Fund maintained by the procurer. PBGs will be returned within 45 days of the project’s actual supply commencement date, with partial releases allowed for phased project compcompletion. guidelines also reinforce regulatory oversight.

Clause 18 mandates that any deviations from the guidelines require prior approval from the Appropriate Commission before initiating the bidding process. The commission must approve or request modifications within 60 days to ensure procedural efficiency.

However, bids already approved before these amendments do not require fresh approval. These amendments aim to strengthen India’s wind energy sector by providing greater regulatory clarity, enhancing investor confidence, and ensuring stricter compliance. The updated guidelines are expected to accelerate project timelines, improve grid reliability, and support India’s ambitious target of 500 GW of renewable energy capacity by 2030.

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