The country’s tender for the largest single purchase of solar PV by a utility was released day before by TANGEDCO.
The tender does not have many changes from what was mentioned during the consultation meeting held about 2 weeks back, and that is a pity in a way.
Bidding process – is there a change?
One change (or is it a change) I see is the wording of the selection of bidders : “Selection of L1 Bidder shall be determined as per “Transparency in Tender Act 1998” and “Transparency in Tender Rules 2000”. TANGEDCO will evaluate only those tenders, which are received by the appointed date and time at the office of CE/NCES/TANGEDCO/Chennai-2 based on the qualification criteria and all the bids satisfying the eligibility criteria shall be qualified by TANGEDCO. The bidders who have quoted lower rates (i.e) L1, L2,L3 etc… will be called for negotiation in that order and Letter of Intent (LoI) will be issued to all the qualified projects, provided the developers of the project are willing to supply at the negotiated and accepted rate till the aggregate capacity awarded to the bidders reach 1000 MW”
This appears to be different from what was mentioned earlier – that the lowest price will be taken and all the bidders will be asked to bid at that price once more. Here, it appears that they plan to follow the mechanism followed by NVVN, which is awarding the lowest bidders at the prices they bid and not at L1 alone. Not sure entirely if this is what was meant, will get to know on 19th in the pre-bid meeting.
Update: I checked with some folks from TANGEDCO – apparently what they mean by “negotiation in that order” is probably asking all of them to bid at L1. This is the way TNEB has been working on its other bids so far. Not 100% certain, but quite.
The other interesting highlight I find is the emphasis on how the payment will be made: “The due date for payment of energy bill will be 30 days from the dated of receipt (excluding the date of receipt) of bill in complete from the generator. TANGEDCO shall provide unconditional revolving and irrevocable LC which shall be drawn upon the solar power plant developers. TANGEDCO shall provide LC from public sector/scheduled commercial bank.” Now, the question is, will prominent banks be willing to issue LCs for TANGEDCO?
Still, no upper limits
I dont see the tender document having addressed a key concern – lack of upper limit. It is difficult to see how bid prices quoted for 1 MW and 100 MW could be compared as apples to apples.
Perhaps I will be proven wrong; perhaps this is the best way to do price discovery!
The tender document is available here
Just thought I’d also let you know that EAI is now offering bid advisory services to companies keen on bidding for the TN Solar Projects. Get to know more about this from here.
(And just when you thought things could not get more hot on the solar front, Andhra Pradesh released its tender document for 1000 MW of solar power purchase)