Government Issues Bidding Guidelines for Pumped Storage Projects
POWER & RENEWABLE ENERGY

Government Issues Bidding Guidelines for Pumped Storage Projects

The Ministry of Power has released tariff-based competitive bidding guidelines for procuring stored energy from existing, under-construction, or new Pumped Storage Projects (PSP). 
According to the National Electricity Plan 2023, India will require 74 GW/411 GWh of energy storage systems (ESS) by 2031-32, including 27 GW/175 GWh from PSPs and 47 GW/236 GWh from Battery Energy Storage Systems (BESS). 

Procurement models 

Mode 1: PSPs developed on sites identified by the procurer 

• The procurer selects the site, and the project is developed on a Build-Own-Operate-Transfer (BOOT) basis for 25 to 40 years. 
• A Special Purpose Vehicle (SPV) will handle pre-feasibility activities, including environmental and statutory clearances. 
• The SPV, initially owned by the procurer, will be transferred to the successful bidder at a pre-specified cost. 

Mode 2: PSPs identified by the bidder or already commissioned 

• PSPs may be developed on self-identified sites or existing facilities on a Build-Own-Operate (BOO) basis for 15 to 40 years. 
• Developers must secure environmental, forest, and land clearances before construction. 
• The procurer is not responsible for clearance-related delays. 

Key bidding criteria Minimum bid capacity 

• ISTS-connected projects: 50 MW 
• InSTS-connected projects: 10 MW (lower capacities may be permitted in the Northeast and Special Category States). 

Eligibility requirements 
• Developers must have infrastructure project experience from the last five years. 
• Minimum capital expenditure thresholds will be defined in the bidding documents. 
• Net worth or assets under management must be at least 20% of the estimated capital cost of the project. 

Financial obligations 
• Earnest Money Deposit (EMD): 2% of the estimated project cost. 
• Performance Bank Guarantee (PBG): 5% of the estimated project cost. 

Contractual and regulatory framework 
• The Power Purchase Agreement (PPA) must be signed within six months of the Letter of Award (LoA), or the awarded capacity may be cancelled. 
• The tariff adoption process must be completed within 60 days of application to the relevant Commission. 

Additional provisions 
• Transmission connectivity: Developers must secure access to the ISTS network at their own cost. 
• Force majeure: Developers must notify the procurer within 15 days of any such event. 
• Financial closure: Must be completed within 12 months, with penalties for delays. 
• Minimum commissioning capacity: 50% of the project capacity or 50 MW, whichever is lower. 

The government has also modified its budgetary support for hydroelectric and PSP projects, allocating Rs 124.6 billion for development. These guidelines aim to accelerate energy storage expansion and support India’s growing renewable energy sector. 
(Mercom) 

The Ministry of Power has released tariff-based competitive bidding guidelines for procuring stored energy from existing, under-construction, or new Pumped Storage Projects (PSP). According to the National Electricity Plan 2023, India will require 74 GW/411 GWh of energy storage systems (ESS) by 2031-32, including 27 GW/175 GWh from PSPs and 47 GW/236 GWh from Battery Energy Storage Systems (BESS). Procurement models Mode 1: PSPs developed on sites identified by the procurer • The procurer selects the site, and the project is developed on a Build-Own-Operate-Transfer (BOOT) basis for 25 to 40 years. • A Special Purpose Vehicle (SPV) will handle pre-feasibility activities, including environmental and statutory clearances. • The SPV, initially owned by the procurer, will be transferred to the successful bidder at a pre-specified cost. Mode 2: PSPs identified by the bidder or already commissioned • PSPs may be developed on self-identified sites or existing facilities on a Build-Own-Operate (BOO) basis for 15 to 40 years. • Developers must secure environmental, forest, and land clearances before construction. • The procurer is not responsible for clearance-related delays. Key bidding criteria Minimum bid capacity • ISTS-connected projects: 50 MW • InSTS-connected projects: 10 MW (lower capacities may be permitted in the Northeast and Special Category States). Eligibility requirements • Developers must have infrastructure project experience from the last five years. • Minimum capital expenditure thresholds will be defined in the bidding documents. • Net worth or assets under management must be at least 20% of the estimated capital cost of the project. Financial obligations • Earnest Money Deposit (EMD): 2% of the estimated project cost. • Performance Bank Guarantee (PBG): 5% of the estimated project cost. Contractual and regulatory framework • The Power Purchase Agreement (PPA) must be signed within six months of the Letter of Award (LoA), or the awarded capacity may be cancelled. • The tariff adoption process must be completed within 60 days of application to the relevant Commission. Additional provisions • Transmission connectivity: Developers must secure access to the ISTS network at their own cost. • Force majeure: Developers must notify the procurer within 15 days of any such event. • Financial closure: Must be completed within 12 months, with penalties for delays. • Minimum commissioning capacity: 50% of the project capacity or 50 MW, whichever is lower. The government has also modified its budgetary support for hydroelectric and PSP projects, allocating Rs 124.6 billion for development. These guidelines aim to accelerate energy storage expansion and support India’s growing renewable energy sector. (Mercom) 

Next Story
Building Material

Ambuja Cements Drags JSW Cement to Court Over ‘Kawach’ Brand

Ambuja Cements, part of the Adani Group, has filed a trademark infringement case against JSW Cement in the Delhi High Court, alleging that its rival copied the ‘Kawach’ brand with its new product ‘Jal Kavach’.Justice Manmeet Pritam Singh Arora issued summons to JSW Cement and its subsidiary, JSW IP Holdings Pvt Ltd, while referring the matter to mediation. Hearings are scheduled to resume on October 15 if no settlement is reached.Ambuja, which registered the ‘Kawach’ trademark in 2019, argues that the term ‘Kavach’—meaning shield—is the distinctive feature of its branding. ..

Next Story
Technology

Bentley Systems Named Innovation Partner of the Year 2025 by Afcons

Bentley Systems, the infrastructure engineering software company, has been recognised by Afcons Infrastructure Limited as its Innovation Partner of the Year 2025 at the Innovation Partners 2025 Felicitation Ceremony in Mumbai. The award acknowledges Bentley’s contribution to Afcons’ engineering digitalisation journey through an enterprise agreement providing access to over 250 Bentley engineering software tools. This adoption has enabled Afcons to accelerate project delivery, standardise digital workflows, and strengthen innovation across its infrastructure portfolio. Among key i..

Next Story
Infrastructure Urban

SBI Sells 13.18% Stake in Yes Bank to Japan’s SMBC

State Bank of India (SBI) has completed the sale of a 13.18 per cent stake in Yes Bank to Japan’s Sumitomo Mitsui Banking Corporation (SMBC) for over Rs 8,889 crore. The divestment is part of a Rs 13,482 crore deal finalised in May with SMBC and seven private banks.Following the transaction, SBI’s shareholding in Yes Bank stands at 10.8 per cent. The deal, involving 4,134.4 million shares at Rs 21.50 each, is the largest cross-border transaction in the Indian banking sector.SBI Chairman C S Setty described the 2020 RBI-led rescue of Yes Bank as a pioneering public-private partnership, addi..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Talk to us?