BEFORE THE RAJASTHAN ELECTRICITY REGULATORY COMMISSION, JAIPUR FILE NO, CASE NO. RERC /2023 IN THE MATTER OF: Petition under Section 86 (1) (b) and other applicable provisions of the Electricity Act, 2003 seeking approval for selection of developers for procurement and approval of bidding documents for ISTS connected energy storage solution of 1000 MW/6000MWh located anywhere in India for meeting the requirement of Jaipur Vidyut Vitaran Nigam Limited, Ajmer Vidyut Vitaran Nigam Limited and Jodhput Vidyut Vitaran Nigam Limited. Rajasthan Urja Vikas Nigam Limited (RUVNL) Petitioner S.N y | Particulars 7 1 | Petition 1-8 Done2. | Affidavit a Annexure ~- 1 3. 10 Approval dated 6.10.2022 Annexure - 2 H-22 4. | Guidelines dated 10-4-23 Annexure - 3 5. Copy of minutes of Meeting EAC feaet Annexure — 4 6. wae 32-120 Copy of bidding document 7 Annexure - 5 IZ -? Copy of standard PPA Ape Humble PetitionerBEFORE THE RAJASTHAN ELECTRICITY REGULATORY COMMISSION, JAIPUR FILE NO. CASE NO. RERC IN THE MATTER OF: Rajasthan Urja Vikas Nigam Ltd. SYNOPSIS The petitioner submits the Petition under Section 86 (1) (b) and other applicable provisions of the Electricity Act, 2003 seeking approval for tie up of 1000 MW/6000MWh per day (continuous discharge of 4 hours) on long term basis from Pump Storage based energy storage solution located anywhere in India, connected to CTU and approval of bidding documents as well for meeting the requirement of Jaipur Vidyut Vitaran Nigam Limited, Ajmer Vidyut Vitaran Nigam Limited and Jodhpur Vidyut Vitaran Nigam Limited. Humble PetitionerBEFORE THE RAJASTHAN ELECTRICITY REGULATORY COMMISSION, JAIPUR FILE NO. CASE NO. RERC IN THE MATTER O} Petition under Section 86 (1) (b) and other applicable provisions of the Electricity Act, 2003 seeking approval for tie up of 1000 MW/6000MWh per day (continuous discharge of 4 hours) on long term basis from Pump Storage based energy storage solution located anywhere in India, connected to CTU and approval of bidding documents as well for meeting the requirement of Jaipur Vidyut Vitaran Nigam Limited, Ajmer Vidyut Vitaran Nigam Limited and Jodhput Vidyut Vitaran Nigam Limited. Rajasthan Urja Vikas Nigam Ltd. yen -Petitioner:BEFORE THE RAJASTHAN ELECTRICITY REGULATORY COMMISSION, JAIPUR IN THE MATTER OF: Rajasthan Urja Vikas Nigam Limited (RUVNL) THE HUMBLE PETITIONER IN THE ABOVE-MENTIONED PETITION MOST RESPECTFULLY SHOWETH: That the Petitioner on behalf of Distribution Licensees i.e., Jaipur Vidyut Vitran Nigam Limited, Ajmer Vidyut Vitran Nigam Limited, and Jodhpur Vidyut Vitran Nigam Limited intends to initiate a bidding process for tie up of 1000 MW/6000MWh per day(continuous discharge of 4 hours) on long term basis from Pump Storage based Energy Storage Solution (ESS) located anywhere in India, connected to CTU for meeting the requirement Jaipur Vidyut Vitaran Nigam Limited, Ajmer Vidyut Vitaran Nigam Limited and Jodhpur Vidyut Vitaran Nigam Limited. That the State of Rajasthan through its letter dated 6.10.2022 has accorded its approval for Procurement of power on long term basis througha) 3 tariff based competitive bidding process from 1500 MW wind-solar hybrid projects with required storage system to have flexibility in scheduling energy from storage as per requirement to meet the demand of the state and RPO. Copy of the approval of the State is marked as Annexure-1. That for managing the intermittency of RE Power being injected in the Grid and to manage grid stability, lot of emphasis is being put to add Energy Storage based solutions viz BESS, PSP, etc. Looking at long discharge hours from PSP based energy storage solutions and long useful life (40 years), MoP on 10.4.2023 issued guidelines for promotion of PSP based storage capacity across the country. The copy of guidelines 10.04.23 is Annexure-2, That a structured RE power project with mandatory ESS have inherent demerits that retrains the buying utility from harnessing full potential of an ESS system: That ESS tied-up with RE project will supply power only during the pre-defined peak hours and are fixed for the entire PPA term. Utility do not have flexibility to utilise the tied-up ESS capacity outside these pre-defined peak hours,b) 4 Structured RE power with ESS will always be mandatorily charged from electricity generated from the identified RE generating sources only. Standalone ESS are capable of multi-cycle operations however in a structured RE ESS project where charging is mandatorily from identified RE Project and multi cycle operation of an ESS gets hampered, In a structured RE tender majority of the electricity supply is from RE projects and thus RE generators who may not have expertise in ESS participates and set-up the projects. In such cases, ESS technology and operations are decided to maximize the commercial benefits available to the developer and not the buying utility, That the demerits associated with structured RE Power projects with ESS can be mitigated by tying-up RE & ESS capacity separately. Following advantage/flexibility may be ensured:- Agencies having specialisation in setting up of ESS will only participate and offer solution which is more suited to the requirements of the buying entity, Standalone ESS will provide flexibility to RUVNL to manage peak demand, seasonal variation in°) 4) S demand & availability to avoid RE curtailment, manage ramping requirements for conventional asset, deviation management. There may be more options to charge ESS by available RE power or through combination of RE & non-RE power and discharge the system as per real-time requirements. Flexibility to sale the stored energy in the market. That the Energy assessment committee of the State of Rajasthan in its 20" meeting held on 07.01.2022 have shown a deficit of energy in peak hours. The copy of minutes of meeting is annexed as Annexure-3. That standalone ESS can be charged during off-peak hours and stored electricity can be supplied back to meet the deficit in peak hours. That RERC vide its order dated 13.6.2023 notified RPO targets for the period from FY 2024-25 to FY 2029-30 in line with the targets notified by MoP. Computation of the Energy Storage Capacity requirement to meet storage obligation is annexed as Annexure-3. By FY 2029-30 RUVNL will need ~1589 MW additional storage capacity. This capacity is calculated considering 6 hours of storage and will vary on pro-rata basis if actual10. il. 12. storage duration varies from 6 hours. For e.g. if 8 hour ESS is considered capacity required will be ~1190 MW (1589*6/8). That considering this BoD RUVNL in its 57th meeting held on 17.8.2023 resolved to initiate a separate tender process to tie-up of 1000 MW ESS from Pump Storage hydro Projects with specified no of discharge hours on daily basis for flexibility to schedule as per requirement. That since there are no standard bidding guidelines issued by the Ministry of Power nor there is any standard bidding document and therefore the petitioner has formulated a bidding document for tie-up of storage capacity of power from PSP. That till date only two bid processes for tie-up of standalone ESS Capacity has been concluded; one by NTPC for 500 MW / 3000 MWh and another by Power Company of Karnataka Limited for 1000 Mw / 8000 MWh. That the bidding document has been prepared in clear consonance of the intention of the legislation under Electricity Act 2003 to ensure utmost participation and procurement at the least tariff so as to meet out the deficit of demand in peak hours‘ 13. and in the interest of consumers of the State of Rajasthan. Copy of the bidding document is submitted as Annexure-4. The standard copy of the PPA is also submitted as Annexure-5. That, since there is no standard bidding document available nor there are any standard bidding guidelines for tie-up of storage capacity from PSP, therefore, the petitioner approaches this Hon’ble Commission seeking approval for- Prayer tie up of 1000 MW/6000MWh per day(continuous discharge of 4 hours) from Pump Storage based energy storage solution located anywhere in India, connected to CTU and approval of bidding documents for meeting the requirement of Jaipur Vidyut Vitaran Nigam Limited, Ajmer Vidyut Vitaran Nigam Limited and Jodhput Vidyut Vitaran Nigam Limited Since, there has not been much development on Pumped Hydro Projects and only two bid process have been concluded in the country so far, this is the first ever attempt by RUVNL to float the bid for standalone ESS therefore it is requested that Petitioner may be allowed to make changes /modification in the bid document based on thesuggestions received from the prospective bidders, system experts and on account of any guidelines/ notifications/ advisory/ directives, etc issued by Competent Authority during the course of Bidding Process, It is therefore humbly prayed that the petition may kindly be allowed in above terms. Date: dg Humble Petitioner RUVNLg BEFORE THE RAJASTHAN ELECTRICITY REGULATORY COMMISSION JAIPUR RERC Petition No. / 2023 In the matter of Rajasthan Urja Vikas Nigam Ltd. we Petitioner Affidavit in support of Petition 1, Alok Kumar Pareek, Age 48 years, working as Executive Engineer (RAI) in RUVNL, Jaipur do hereby take on oath and state as under:- 1. That I am officer in-charge in the above noted case and as such am well conversant with the facts and circumstances of the case, 2. That the annexed petition has been drafted under my instructions by my counsel and the contents have been read over and understood eRe. - ha the contents contained in the petition are true and correct to VERIFICATION; “I, the above named deponent do hereby declare on oath that the Contents contained from para No. 1 to 3 of my above affidavit are true and Correct to my personal knowledge. Nothing material has been concealed therein and no part of it is false. So help me God. +ED RUVNG, JaipurAnnx | nt of Rajasthan rome Gove rtment Energy Depat spur Pate Bay a 22? No FS ENTRY Chief Engineer Rajasthan Urja Vikas Nigam Ltd Jaipur. t of Solar & Hybrid bi: Regarding approval of the GoR for procuremen ee (solar ‘wind) power with storage on long term basis through tariff based competitive bidding process. > lund reler your Teter No. RUVNL/CE/SE/PP/F.235/D.302 dated secking approval for procurement of Solar & Hybrid (solar-wind) power storage on Jong term basis through taril {f based competitive bidding process Some [am directed to convey approval of State Government tor ot power as detailed at below (a) & {b} on lang term basis as per the stones wwsued by MoP/MNRE Gol through tariff based competitive bidding meet the demand of the state & to fulfill the RPO trajectory WMA Soler Power Projects in the state of Rajasthan and connected to rect dhe day power demand of the state & other RPO wo power supph from FY 2025-26. ae Suu MW Wand Solar Hybrid Project with required storage system to have eons im scheduling energy from storage as per requirement to meet far demand and to meet Wind, Storage and Others RPO of dhe Discoms. FY 2020 2 8 + peer supph ire: Venues tauchnatly Uy : (8rij Gupta) Sr. Dy. Secretary, EnergyAnns 2 F. No. 15-14/9/2022-H-IK Part) “AIT WRG! Government of india Pele HaTete / Ministry of Power Shram Shakti Bhawan, Rafi Marg New Delhi - 110001, Tel: 011-23705841 Dated: | April, 2023 To The Secretaries of all the Ministries / Departments of Government of India The Chief Secretaries of the State Governments & Union Territories Principal Secretaries (Energy / Power) - All the State Governments & UTs CMDs - PGCIL, NTPC, NHPC, SJVN, THDC, NEEPCO, Grid India, PFC, REC The Chairman - BBMB, DVC ‘Sub: Guidelines to promote development of Pump Storage Projects (PSP) - reg Sir Madam, This has reference to Ministry of Power's letter of even number dated 15" February, 20283 vide which the draft PSP Guidelines were circulated for comments / suggestions, Subsequent binar was held on 23” February 2023 on the topic of "Green Growth’, Wherein, inter alia, suggestions were also received on the framework for Pumped Storage Projects in the country. 2. Based on the comments / suggestions received from the stakeholders, the Guidelines to promote development of Pump Storage Projecis in the country have been finalized. A copy of the PSP guidelines is enclosed herewith for information and necessary action, This issues with the approval of Hon'ble Minister of Power and New & Renewable Energy. Yours sincerely, (Moh ah ( [h Joint Secretary Ematt: afzal_mdp@pnic.in Jhydro2-mop@gov.in Fel: 011-23714000 Copy t 1, CEO, NITI Aayog 2. Secretary, CERC / All SERCs 3. Chairperson, CEA 4. Chairperson, CWC Copy also to: in-charge, NIC Cell, MoP: with request to upload the Guidelines on the website of the Mi of Power. sone | xu 7Guidelines on Pumped Storage Projects 4. Introduction Energy Transition entails increasing presence of variable and intermittent Renewable Energy Sources (VREs) like solar & wind in the energy mix. This presents a grid-level challenge for stability and a need for addressing the temporal considerations in power availability. Storage and ancillary services would be the attributes that require incentivization in the power system to ensure appropriate capacity. Comprehensive storage guidelines are required to set the direction of developments in this regard. Amongst the various technologies available for addressing this requirement of storage and ancillary services, Pumped Storage Projects (PSPs) are clean, MW scale, domestically available, time tested and internationally accepted The positive aspects of PSPs are not jimited to the attributes of storage and ancillary services. PSPs are clean, green and safe. They don't produce any poisonous/ harmful by-products or pose problems of disposal. The advantages of promoting PSPs are not only based on their usefulness in maintaining grid stability and facilitating VRE integration but also their other positive attributes when compared to other available energy storage systems. 1.1 Perspectives Flexible Energy Generation Assets that can supply both Base Load & Peaking Power efficiently and economically are the need of the future and necessary to address the dynamically evolving energy needs of India. At present, Variable Renewable Energy Sources (VRE) such as wind and solar are being connected to the grid at a rapid pace owing to their low cost of installation and the thrust on sustainable & green energy. The energy supply from VREs can't be regulated since they are dependent on the time of the day, seasons, and the vagaries of weather. Henee, there is an ever-increasing demand for Energy Storage Assets, PSPs are best suited in the present scenario for addressing this demand. PSPs are also known as ‘the Water Battery’, which is an ideal complement to modem clean energy systems. PSPs provide the necessary scale of storage and have a long service life of more than 40-60 years. This is much more than any other energy storage technology presently available. This also results in a low cost of delivered energy over the life of the projects. PSPs are also non-polluting and are more environmentally friendly Pumped Storage Projects account for over 95 percent of installed global energy storage capacity. It is estimated that pumped hydro projects worldwide store up to 9,000 gigawatt hours (GWh) of electricity worldwide. Se te(a) Energy Transition Considerations India is on the path towards a clean energy transition, guided by the Nationally Determined Contribution (NDC) targets, to reduce the emission intensity of its Gross Domestic Product (GDP) by 45% by 2030, get to 50% of installed capacity from non-fossil fuel sources by 2030 and achieve net zero carbon emissions by 2070. Given the ongoing energy transitions in the country, the development of PSPs is of paramount importance for providing greater inertia and balancing power to the grid as battery storage solutions are still being scaled up and are required for short duration storage needs in grid management, PSPs are a natural enabler for integrating greater amounts of wind and solar power. With its ability to store a large amount of energy, frequent starts/stops, and faster ramp- upsiramp-downs, PSPs are ideally suited to address the dynamic supply and demand. PSPs can also be used for peaking operation and improve the reliability of the power system (b) Ancillary Services Considerations Wind and Solar power have become one of the lowest-cost sources of renewable energy. However, their inherent variable, uncertain and intermittent nature presents a huge challenge for integrating large quantities of renewables, while Maintaining grid stability. Curtailment of wind and soler power is already being witnessed in some areas although they presently constitute only around 25% of total energy capacity. With the increasing presence of VREs, the need for curtailment will be more acute if there is insufficient storage in the grid. PSPs present a viable Solution to the integration issues of large RE capacities. They are best equipped for Peak ioad requirements. PSPs can store a large amount of energy during off-peak hours and discharge over longer period. Thus, PSPs would help reduce RE curtailment and improve the piant load factor of VREs. (c) Temporal Considerations 't is anticipated that with the increasing presence of VRE in the energy mix, the generation of wind and solar energy may be at its peak where the energy demand is the lowest, If the energy from these sources is not stored during off-peak hours in times to come, there will be an increasing need for large operating reserves from thermal power plants (typically high carbon coal and gas) to meet the peak demands of the country. PSPs provide an economical solution by off taking a large amount of energy from the grid during off-peak hours, increasing the load factor of other systems, and also providing additional capacity to meet the peak loads. Pumped hydro storage provides a dynamic response and offers critical backup during periods of excess demand along with maintaining grid stability. Without PSPs, full decarbonisation of the electricity sector will not be achievable at reasonable costs. Thus, PSPs provide ‘green storage’ and make VREs dispatchable by firming up the capacities, a 134.2 Advantages of Pumped Storage Projects (a) Ecologically friendly PSPs would have minimal impact on the environment in their vicinity as they are mainly envisaged on the existing Hydro Electric Projects, reservoirs, or as off- the-river projects. All components of PSPs would be connected, operated, and maintained in an environmentally friendly manner. There are no residual environmental impacts in the case of PSPs. (b) Atmanirbhar Bharat The guidelines for the development of storage systems synchronize with the vision of Atmanirbhar Bharat, The PSPs primarily use indigenous technologies and domestically produced materials. Most of the electrical & mechanical parts of PSPs are also made in India. Other alternate solutions to storage such as batteries are heavily import-dependent (c) Tested Technology ‘The PSPs operate on time-tested technology thereby infusing confidence in the lending institutions for a longer duration of loans. Additionally, the cost of technologies involved in the construction has reduced rendering PSPs a viable proposition. The technological surety associated with PSPs has opened the possibilty for the developers to claim a higher debt-equity ratio in the projects. (d) Local developmental The development of PSPs is highly capital intensive and involves the development of focal transport infrastructure for the mobilization of men and materials. Local industries such as cement and steel also get impetus and drive job creation in the economy. This in tur have a salutary effect on local area development. PSPs are an ideal investment for socio-economic and regional development considerations like infrastructure up-gradation and employment generation {e) Longer and reliable duration of discharge PSPs are generally designed for a longer duration of discharge of more than 6 hours to meet the peak demand or for compensating the variability in the grid due to VREs. Currently, Battery Energy Storage Systems are designed for up to 4 hours of discharge generally. The firm capacity of PSPs during peak hours is guaranteed and relatively immune to the grid conditions. De1.3. Pumped Storage Potential and Development Status As of date, the CEA estimates regarding on-river pumped storage potential is 103 GW in india. Apart from the above, a large capacity of off-river pumped storage potential is also available which is being estimated. Suitable support is to be extended to the identification and evaluation of such potential. As of now, 8 projects (4745.80 MW) are presently in operation, 4 projects (2780 MW) are under construction, and 27 projects (29930 MW) have been allotted by States which are under different stages of development. 1.4 Long Term Plan for Pumped Storage Hydro Development The long-term approach to the development of pumped storage projects will be driven by various factors regarding the requirement of the grid to achieve the energy transition. As per the revised draft NEP published by the Central Electricity Authority, the country would require 26.7 GW of Pumped Storage Projects and 47.2 GW of BESS (5 hour) to integrate the RE capacity envisaged till 2032. The PSP capacity requirement may further increase if the cost of BESS does not come down as expected. The Central Electricity Authority will continue modelling and forecasting the energy demand and energy mix over the long term and providing an indication of the probable requirement of the various forms of storage. This exercise would mean factoring in the aspects of viability and technology change. The Resource Adequacy Plan will consider storage as an element of planning 1.5 Barriers in the development of Pumped Storage Projects (a) Environmental clearances Presently, the environmental clearance and forest clearance process of PSPs is very cumbersome, since these projects are treated at par with the conventional hydro projects for the purpose of grant of EC and FC. The environment impact of PSPs constructed on existing reservoirs on on-the-river sites and on the off-the-river sites is much less than conventional HEPs. Further, unlike the conventional hydro Projects, development of PSPs do not lead to significant displacement of the people and thus, require minimum R&R. Therefore, PSPs constructed on existing reservoirs and on off-the-river sites may be treated as @ separate category for processing of clearances. (b) Free power PSPs are fundamentally energy storage projects designed to cater the need of grid stability during the peak hours. Unlike conventional hydro projects, PSPs do peesnot produce electricity. They are net consumers of electricity. Therefore, there is no question of imposing the requirement of free power on PSPs (c) Cost of pumping power The cost of power from PSPs has three components - cost of storage, cost of conversion losses and cost of input power. One of the prerequisites to ensure the commercial viability of a PSP unit is availability of input power at affordable tariff. However, this constraint is likely to be overcome in near future, with the availability of solar and wind power at relatively cheaper rates (d)_ Value of peak power The importance of PSP lies in its capability to offer peaking power. Further, other services offered by PSPs, like spinning reserves, reactive support, black start ability, frequency response ancillary services and faster start-up and shutdown, which are essential for grid stability, are not adequately monetized 2. Measures already taken by Government of India for promotion of PSPs 2.1 Utilization of financial and project execution capabilities of CPSUs Government of India vide its order dated 08.08.2022 has indicated identified PSP sites against CPSUs to facilitate their development. A state-wise indication has also been carried out to help the States with work related to PSPs. States are encouraged to allocate the PSPs to CPSUs for early and prompt development aligned with the national interest. The present indication is at Annexure-1, 2.2 Energy Storage Obligation Government of India has, vide its order dated 22.07.2022, notified the trajectory of Energy Storage Obligation for the distribution companies to ensure the capacities regarding storage as a grid element. This would create demand for storage. The present trajectory is at Annexure-ll 2.3 Waiver of ISTS charges for PSPs Given the importance of facilitating RE integration in the grid and in pursuance of National Tariff Policy 2016, waiver of ISTS and other transmission charges have also been made available to Pumped Storage Projects vide Ministry of Power's Order dated 23.11.2021 which is given at Annexure-IIl In order to promote the development of PSPs, the waiver of ISTS charges shall be extended to all those PSPs where construction work is awarded by Nees Ie30.06.2025. ISTS charges shall be levied on PSPs where construction work is awarded after 30.06.2025 as per the following trajectory: | Award of construction work | ~_18TS charges 04.07.2025 to 30.08.2028 | 25% of applicable ISTS charges 1026 50% of applicable ISTS charges [04.07.2027 to 30.06 2028 75% of applicable ISTS charges i From 01.07.2028 100% of applicable ISTS charges 2.4 Budgetary Support for Enabling Infrastructure The hydro projects and PSPs are often taken up in remote areas which have infrastructure deficits, The infrastructure created for hydropower / PSP enables further development of the area as the same is available for reuse for other purposes. Given the same, the Central Government is providing oudgetary support for funding the enabling infrastructure of hydropower projects. This scheme also covers PSPs. The grant for enabling infrastructure is for the creation of infrastructure facilities that have alternate developmental value. The present dispensation in this regard is at Annexure-IV, and also applies to PSPs. 2,5 Timelines for formulation and concurrence of Detailed Project Reports for Pumped Storage Projects The Central Electricity Authority has issued revised guidelines for formulation and for examination & concurrence of Detailed Project Reports for Pumped Storage Projects in July 2022 and August 2022 respectively. As per revised guidelines, the timelines for preparation of DPR for PSPs has been reduced from 900 days to 720 days. CEA shall further reduce these timelines for off-stream closed loop PSPs and PSPs on existing Hydro projects (where one reservoir is available). In addition, since no tariff / financial evaluation is required to be done by CEA for PSP projects allotted through Tariff Based Competitive Bidding or as part of integrated Renewable Energy Project or as captive plants, CEA has reduced the timeline for concurrence of such projects from 150 days to 75 days. For other PSPs, the timelines for concurrence has been reduced from 150 days to 125 days, 3. Guidelines for promotion of PSPs The following guidelines are being issued for the promotion of Pumped Storage Projects: 3.1 Allotment of project sites age : \7The State Governments may allot project sites to developers in the following manner: (i) On nomination basis to CPSUs and State PSUs For early development, States may award projects directly to hydro CPSUs or State PSUs on a nomination basis. Due consideration shall be given to the experience and financial strength of the CPSUs/State PSUs. The projects may also be allotted to Joint Ventures (JVs) between CPSUs and/or State PSUs for development of such PSPs. Further the CPSU/State PSU shall ensure that award of ‘contracts for the supply of equipment and construction of the project, either through a tumkey or through well-defined packages, is done based on competitive bidding (ii) Allotment through competitive bidding PSP project may also be awarded to private developers by following a two stage competitive bidding process. PSUs may also be allowed to participate in the bidding process. The first stage shall be for pre-qualification based on criteria of financial strength, experience of developing infrastructure projects of similar size, past track record of developing projects, turnover and ability to meet performance guarantees. In the second stage, bids are to be called based on quantifiable parameters such as concession period of the project or any other parameter as specified by the Central/State Government. In case of allocation through modes 3 (') & (ii) above, the home state shall have the right of first refusal upto 80% of the project capacity and tariff shall be fixed by the Appropriate Commission u/s 62 of the Electricity Act, 2003 The developer would be free to sell the balance storage space under short / medium / long term PPA, or in pawer markets or through bilateral contract. (iii) Allotment through TBCB PSPs may also be awarded on a TBCB basis to developers. For this purpose, the task of carrying out S&l and preparation of DPR may be given to an SPV under a CPSU/State PSU, SPV may be responsible for pre-construction activities such as preparation of project report, land acquisition, environment and forest clearance, etc. Such a dispensation would ensure the possibility of tarif determination based on competitive bidding. The DPR may be subsequently bid out for construction and SPV transferred to the successful bidder on the basis of, a. Composite tariff (including the cost of input power) in case input power is arranged by the developer; or b. Tariff for storage on a per Megawatt Hour basis if the input power is to be arranged by the procurer of the storage capacity joe4 The appropriate Commission shall adopt the above tariff u/s 63 of the Electricity Act, 2003. (iv) Self-Identified off-stream Pumped Storage Projects In addition to the above methods, developers may also self-identify potential off-stream sites where PSPs can be constructed. Since these sites are away from the riverine system and do not utilize the natural resources like river streams, allotment from State Governments would not be required for the development of PSP projects on such sites. Further, all statutory clearances need to be obtained from State and Central agencies before starting construction. It will help in hamessing the off-stream potential in the country at a faster pace. Projects developed in such a manner would be provided all concessions mentioned in these guidelines, subject to the directions issued by the Government from time to time. 3.2 Timelines for Start of Construction work after award of Project Developers shall start construction work within @ period of 2 years from the date of allotment of the project, failing which allotment of the project site shall be cancelled by the State. However, relaxation of 1 year may be granted to those projects where delay in start of construction is attributable to pending Environment Clearance (EC) and Forest Clearance (FC), provided that the applications are submitted to concemed authorities within timelines agreed at the time of award of the project. 3.3 No Upfront Premium for Project Allocation In order to ensure the viability of the Pumped Storage Projects, States shall ensure that no Upfront Premium is charged for project allocation. 3.4 Market reforms The comparison of PSPs with other conventional and VRE sources purely based on financial aspects is undervaluing and de-emphasizing the economic benefits extended by these projects. The monetization of Ancillary services provided by Pumped Storage Projects will give a much-needed boost to the sector. For this purpose, the following reforms may be undertaken: i. The appropriate Commission shall ensure that services like spinning reserves, reactive support, black start, peaking supply, tertiary and ramping support, faster start-up and shutdown, which help in supporting grid stability are suitably monetized. ii, Appropriate Commission shall notify Peak and Off-Peak tariffs for Generation to provide appropriate pricing signal to Peak and Base Load Generating Plants. ve 8Le li, PSPs and other storage projects shall be allowed to participate in all market ‘segments of the power exchange, including the high price segment of the Day Ahead Market (HP-DAM) so that they can take suitable advantage of the price differential between Peak and Off-Peak tariffs, jv, 80% power generated when PSPs operate as conventional hydro power stations during monsoon period (i.e. no pumping energy required for power generation) would be offered to the Home State at the rate of secondary energy fixed by the Central Electricity Regulatory Commission. The developer shall be allowed to sell the remaining energy to cover their Operation & Maintenance costs and other expenses. v. In the event of capacity contracted not being fully utilized by the contracting agency, the developer would be free to transfer the usage of the capacity to other interested entities so that resources do not remain idle. The gains made shall be shared with the original beneficiary in the ratio of 50:50. 3.5 Financial Viability The current power scenario indicates an imminent deep penetration of electricity storage in future and PSPs would be required to be operated invariably in two cycles for as long as variable RE infusion keeps on increasing. Thus, PSPs are expected to be utilized or run to their full capacities. This ensures recovery of costs in a minimum period. With high rates during peak hours in the power exchanges, PSP developers have the opportunity to optimize their operations and earn suitable returns. To ensure that only viable PSPs are taken up for construction, the Central Government may notify a benchmark tariff of storage for investment decisions of developers considering 6-8 hours of operation of the PSP. This will be based on the prevailing and anticipated difference between peaking and non-peaking rates. Efforts would be made to ensure that only those PSP projects are taken up for development whose levelized cost of storage is within the benchmark cost of storage. Financial institutions like PFC, REC, and IREDA shall treat PSPs at par with other renewable energy projects while extending long term loans of 20-25 years tenure. The debt equity ratio of PSP projects can be upto 80:20, in consultation with the financial institutions. 3.6 Taxes and duties To reap the long-term benefits and socio-economic development of states due to PSP projects, State Government shall consider reimbursement of SGST on PSP project components. States may exempt land to be acquired by off-the-river PSPs from payment towards stamp duty and registration fees. Government land, if available, may be provided at a concessional rate to the developers on annual lease rent basis. Roo $Storage is an intermediary system where energy is stored and released later. In line with the principles of double taxation avoidance, Electricity Duty (ED) and Cross Subsidy Surcharge (CSS) shall not be applicable on pumping power for charging of PSPs as PSPs are merely facilitating conversion of energy. Electricity is stored during off-peak hours and discharged during peak hours. ED and CSS may only be levied on the final consumption of electricity. Government of India from time to time has stated that no Water Cess should be levied on Hydro Power Projects since there is no consumptive use of water. Similarly, no water cess shall be levied on PSPs. 3.7 Exemption from Free Power obligation PSPs are energy storage schemes. They do not produce energy. They are net consumers of energy. Hence, the PSPs would be kept out of the liability of free power, 3.8 Local Area Development Fund PSPs have a minimal environmental impact and have no R&R issues. Therefore, there will be no requirement of creation of a Local Area Development Fund. 4, Utilization of exhausted mines to develop PSPs The discarded mines including coal mines in different parts of the country could be used as Hydro Storage and thereby become natural enablers for development of Hydro Pumped Storage Projects (PSPs). Efforts would be made to identify and develop exhausted mines / coal mines as prospective PSP sites in consultation with the Ministry of Coal, Ministry of Mines and respective State Governments. 5. Rationalization of Environmental Clearances for PSPs The off-river PSPs, are located away from the river course and have minimum impact on the riverine ecology. Hence they need to be treated differently for grant of Environmental Clearance. Ministry of Environment Forest & Climate Change (McEF&CC) has already initiated action in this regard. As per draft notification issued by MoEF&CC on 11.10.2022, PSPs which meet the following criteria would be appraised under B2 category for grant of Environmental Clearance (EC) irrespective of power generation capacity: bu : 2)22 (a) Projects which do not attract Forest Clearance (FC) and/or Wildlife Clearance (we) (b) Projects wherein no new Reservoir(s) is (are) created (c) Projects wherein the existing reservoir (s) is (are) not expanded and/or structurally modified {i.e. no increase in the capacity of reservoir(s) and no increase in submergence area of reservoir(s)} In addition, further liberalisation would be taken up for allowing base line data collection for one (1) season for off-stream closed loop PSPs and two (2) seasons for off-stream open loop PSPs (excluding monsoon season) for the purpose of carrying out Environment Impact Assessment (EIA) and preparing Environment Management Plan (EMP) required for EC, and for allowing collection of baseline data for carrying out EIA/EMP studies before issuance of Terms of Reference (ToR). 6. Green Finance Pumped storage projects are essential for the integration of renewable energy sources in the grid and their utilization, thereby avoiding greenhouse gas emissions. Hence, in order to initiate and accelerate the pace of establishment, PSPs may be supported through concessional climate finance. Sovereign green bonds issued for mobilizing resources for green infrastructure as a part of the Government's overall market borrowings may be deployed in the development of PSPs which utilize renewable energy for charging,ray Assessment Commi on 07.04.2022 linutes of 28 meeting of E 28% meeting of the EAC to review the long-term availablity & demand was held on 07.01.2022 in the Board Room, Vidyut Bhawan, Jaipur. Following were present in the meeting: 1 Sh/ Bhaskar A.Sewant, IAS_CMD, RVPN, Chairman Chairman Discoms & MID, RUVNL 2 Sh. R.K. Sharma CMD, RVUNL Member 3° Sh, Navin Arora MD, JVVNL Member 4 Sh. Avinash Singhvi MD, JDVVNL-through VC Member 5 Sh. S.C. Sharma AC.E(LD) Member Secretary 6 Sh, Mukesh Bansal C.E. RUVNL ‘Special invitee Sh. AK. Jagetia, Director (Technical), AVVNL participated in the meeting on behalf of Managing Director, AVVNL through video conferencing. Chief Engineer RUVNL informed that the 21% meeting of Energy Assessment Committee (EAC) was held on 28.06.2019. EAC finalized and approved the anticipated avallablity, demand and deficit in the state. The EAC anticipated a deficit of 268 MW in the year 2022-23 which progressively increased in the subsequent years and the estimated accumulated deficit by 2026-27 is 6221 MW (Annexure 1), Hon'ble Chief Minister during the Budget Speech 2018-20 on 10.07.2019 announced that Government shall make a detailed action plan to develop 8000 MW additional Power generation capacity from conventional sources in the coming 7 years. Energy Department, GoR vide letter dated 19.03.2021 conveyed in-principal approval of GoR for development of 6000 MW additional generation capacity subject to the condition that impact of providing day power in two blocks to agriculture consumers on demand pattem of the State may be reassessed by EAC and accordingly necessary action may be initiated to meet out the deficit. ‘Subsequent to 2019-20 budget announcements, Government of Rajasthan in budget speech for FY 2020-21 announced that agriculture consumers of State of Rajasthan will be given power supply in two blocks during daytime in phased manner upto March- 2023, Energy Department, GoR vide order No. F. 17(7) Energy/2019 dated 17.05.2021, constituted a committee for studying the impact of providing day power in two blocks to agriculture consumers on demand pattern of the state and further devise the action plan from conventionalrenewal sources to meet the deficit. if eny. Meeting of the Page| 1 See” eau) 23committee was held on 10" June 2021 under the Chairmanship of Managing Director, RUVNL, EAC in its 28" meeting held on 01.07.2021 advised that rigorous exercise be done by Discoms for assessment of additional impact of shiting of agricultural load in day time. EAC in this meeting also approved procurement of 268 MW RTC power from 01.04.2022 on long term basis as per guidelines issued by Ministry of Power. As per direction of ACS Energy, GoR, a meeting was held on 15.12.2021 under the chairmanship of Director (PT), RUVNL along with the representatives of Discoms, RREC & CE(LD) RVPNL to discuss and finalize the methodology for assessment of energy requirement & peak demand up to FY 2028-30 considering the impact of Providing day power in two blocks to the agricultural consumers on the electricity demand pattern of Rajasthan. It was decided in the meeting that CAGR of 6.88% for peak demand may be considered as per CEA’s 19" EPS after accounting for the agriculture load shifting of 380 MV during 2021-22 and 846 MW during 2022-23 in day time (Copy of MoM enclosed). Accordingly, CE, RUVNL made a presentation (Annexure 2) proposing the projected poak demand and surplusideficit for the year 2022-23 to 2029-30. CE, RUVNL apprised that re-assessed projections for Peak Demand and Deficit for the period from FY 2022-23 to FY 2029-30 are as follows: inticipated| Anticipated] p., | Anticipated Anticipated Energy Financial peak | Available lugfcie in| Eneray | Available | surplus Year | demand | Capacity MW) demand Energy deficit {in MW) {in MW) (in MU) {in MU) (in MU) «a | @ @ [el] (F) | (GFE) 2022-23, 17,757 | 12,847 | 4910 | 96,411 | 105,384 | 8,972 2023-24) 18,979 | 13,636 | -5,343 | 102,369 | 109,143 | 6,773, 2024-25) 20,284 | 14886 | -5,398 | 108696 | 115407 | 6,712 2025-26) 21,680 | 14,730 | 6.950 | 115.413 | 114,798 | -615 2026-27| 23,172 | 14,673 | -8,499 | 122,546" | 114,677 | -7,869 2027-28| 24,766 | 14,501 | -10,265| 130,119 | 112,713 | -17,406 2028-28) 26,470 | 14,928 | -12,141] 198,161 | 111,025 | -27,196 2028-30} 28,201 | 14,928 | -13.963} 146,699 | 110,520 | -36,179 “VAs par EAC, 2079 tho projected energy requiromant of Rajasthan for FY 2026-27 le 726,250 MU ps Agee ea cue Page |2 24A comparison of the projected generation available from the installed capacity viz-2- viz actual generation is presented in Annexure 3. During FY 2018-19; ratio of Energy Availability to Actual generation for the country was 1.74, Similarly, for FY 2019-20 and FY 2020-21 ratio was 1.73. For the same period ratio of Energy Availability to Actual generation for Rajasthan was 1.33, 1.31 and 1.38 during FY 2018-19, FY 2079- 20 and FY 2020-21 respectively. Hence, position of Rajasthan is much better as compared to national averages. The Committee discussed as under. 1. While procuring power from renewable sources, adequate scope for conventional Power is required for balancing and grid security. Energy requirement of the state {is expected to grow at 6.18%; to meet the increased energy requirement and ‘maintain grid stability, certain portion of this demand is to be met through thermal capacity. Further, trom the graphs attached, it is evident that the demand during the day hours (6 AM to 6 PM) and during evening/night hours (6 PM to 6 AM) will increase every year. To meet the increasing demand during the night hours, firm capacity tie-up may be required from thermal power stations, 2. Central Electricity Authority published a report in January-2020 on optimal generation mix for the country for meeting its energy requirements by FY 2029-30. In this report CEA has held that, by FY 2029-30, thermal power capacity will be 36% of the total installed capacity and will meet 56% of the total energy requirements. Chart-1: India's Installed Capacity & Gross Generation (BU) for FY 2018-19 {as per CEA’s Optimal Generation Mix Report) Installed Capacity (363,370 MW) Gross Generation (1,378 BU) Nucear, usar, Brucan yee 8780, 234 8 impor 45399, 037% 12% Hydro, 135 1086 4 at es.177, N oe te ease Baan am on Thermal, 107, 784 "Thermal includes coal, gas and ignite In the FY 2018-19, to meet out the 78% of the thermal generation ie. 1,072 BU: the corresponding equivalent installed capacity of thermal power plants is 144,000 MW | Page| 3 pe eee26 (considering thermal power plants operate at normative levels i.e. 85% availabilty) Against this actual installed capacity is 228,601 MW which is 1.9 times the equivalent installed capacity Chart-2: Rajasthan. Contracted Capacity (MW) & Energy Purchased (MU) for FY 2018-19, Contr icity (21,078 nergy Purchased™ 47 MU) ‘aa ome seats eh a a 2.666; 3% ms ait a re wea = Saclay si lleied il wat het tie =a sled In the FY 2018-19, Rajasthan Discoms purchased 79% energy from thermal power Plants i.¢, 65,016 MU; the corresponding equivalent installed capacity of thermal power plants is 8,732 MW (considering thermal power plants operate at normative levels ie. 85% availabilty). Against this actual installed capacity is 12006 MW which is 1.37 times the equivalent installed capacity, less than the above-mentioned countrywide number. Chart-3: India’s Projected Optimal Generation Mix FY 2029-30 (as per CEA’s Optimal Generation Mix Report) Install 17,254 Mi 088 Generation PSs, ous \ Eg ios cae | yon — Page |427 As per CEA, total generation from thermal power plants (Coal, Gas Lignite) will be 1393.10 billion units in FY 2029-30. For this generation, equivalent thermal capacity required is 187,094 MVV (considering thermal power plants operate at normative levels i.e. 85% availability). However, as per CEA to meet this generation requirement Installed capacity of thermal power plants is 291,991 MW which is 1.56 times the ‘equivalent thermal capacity Chart-4: Rajasthan's energy mix as per CEA for FY 2029-30 Installed Capacity (21,078 MW) Energy Purchased (146.70 BU! ti, P58, 0. e128, 785,03, somes, ee te Bora, Eee ost ene a vee Win 180, t93ee ee 08. Applying CEA’s optimal generation mix on Rajasthan's energy requirements in the FY 2029-30; thermal capacity required for Rajasthan is 17,014 MW. Against this current contracted capacity from thermal piants is 13,421 MW. Of this capacity; 8) 252 MW capacity from NTPC plants is being surrendered, b) 640 MW capacity of KTPS will be phased out in Deo-22 ©) 1260 MW STPS plants will be phased out by Aug-28 in phases, d) 250 MW Giral power plant is not operational, ©) 321 MW from Dholpur gas based power plant is not available, and 1) 380 MW power from Coastal Gujerat Power Ltd. is not being supplied. 9) 150 MW power is proposed to be available from NTPC Singraulli Stage til in FY 2026-27. Therefore, available contracted capacity from thermal power plants will be of 10,478 MW and deficit of 6,536 MW capacity by FY 202-30 is envisaged. 3. Further, anticipated peak deficit is to the tune of 4,910 MW in FY 2022-23. Peak demand is generally observed during 8:00 AM to 10:00 AM of the day during which availability of solar is around 10%-40%, A = ea Page} 5 De4. It was discussed in the committee that, over last four years power purchase from energy exchange has increased from 849 MU in FY 2018-19 to 3,336 MU in FY 2021-22 (upto Dec-2021). It was opined that; power purchase from exchange may be used as @ back-up arrangement only for meeting emergency/peeking requirements and not regular power requirements. 5. During 6 PM to 6 AM; average demand of Rajasthan was 9,028 MWin FY 2021- 22 (til Dec-2021). During these hours generation from solar projects is zero and ‘only reliable energy source to meet demand is thermal power projects and nuclear Power projects. This demand is expected to grow at CAGR of 6.18%. During FY 2020-21; weighted average availability of thermal power plants was 78.05%. Considering this availability; it is observed that there is a deficit of 294 MW. inFY 2022-23, Details enclosed as Annexure-2 RUVNL has also calculated deficit considering the shitting of agriculture load from night hours to day hours, For this average demand for FY 2018-20 is considered and CAGR of 6.18% applied on the same for the period FY 2022-23 to FY 2029- 30. From this demand impact of agriculture load is subtracted and RTC deficit is calculated. For FY 2029-30 deficit comes to 7,786 MW which is 676 MW mare than the deficit calculated above. Detailed calculation is attached at Annexure 4 for reference, Since, FY 2021-22 data has already captured agriculture impact hence it is proposed to use the data for FY 2020-21 for calculation of deficit. 6. 4 Units of Kota Thermal Power Project aggregating to 640 MW will be phased out in Dec-2022. However, in terms of MoEF Gazette Notification G.S.R. 243(E) dated 31 March 2021; FGD implementation is must for unit - §, 6 and 7 in order to continue generation beyond Dec-2022. If these units operate beyond Dec-2022 without FGD installation; they will pay penalty at rate of: @, 10 paisa for first 180 days, ©, 15 paisa for further delay upto 365 day, and ©. 20 paisa for further delay This penalty amount is not @ passthrough on Rajasthan Discoms. Hence, 600 MW Capacity of unit 5, 6 and 7 may not be available post Dec-2022 on account of non- installation of FGD system, Further, for continuous operation from unit-5, cooling tower system is also required 7. Units 1 to § of Suratgarh Thermal Power Project (250 MWV each) will be phased out in Feb-2024, Oct-2025, Jen-2027, Jul-2027 and Aug-2028. However, in terms of MoEF notification, STPS falls under Category 'C’ power plant. STPS is required to meet the compliance of FGD installation by December-2024. Unit-2 can seek ‘exemption on account of retirement in Oct-2025. ya! eee eo i Page|6 28Hence, if units 3, 4 and 5 operates beyond Dec-24; they will have to pay the penalty at rate of: a. 5 paisa for first 180 days, b, 7.5 paisa for further delay upto 365 day, and ©. 10 paisa for further delay This penalty amount is not a passthrough on Rajasthan Discoms. Hence, 750 MW Power from units 3, 4 and § may not be available post Dec-2024 After detailed deliberations EAC decided that: 1. Projections for Peak Demand and Deficit for the period from FY 2022-230 FY 2029- 301s as below. Financial Year |" Gomend ee Capea Lae Esra (in wy) (in My) (A) (8) (c) (D=C-B) 2022-23 47,757 12,847 4,910 2023-24 18,979 13,636 5,343 2024-25 20,284 14,886 5,398 2028-26 21,880 14,730 950 | 2026.27 23,172 | 14873 8,499 | 2oer-2e | 20760 14,501 ~10,265 2028-28 2,470 14,328, “12,141 2028-30 28,291 14,328 “13,963 2, Additional RTC tie-up for the period FY 2022-28 to FY 2028-20 is required to meet out deficit considering average demand during 6 PM to 6 AM of FY 2021.22 (til Dec- 2021) with a CAGR of 6.18% for projections as shown in table below: ( aN Page | 7 ye 2 ‘ 2430 ee T 1 Financial Year _|202t-22|2022-2]2023-24|2024.2612026-28|2026-27|2027-282028-25|2028-30 erage Ninian [Demand 6Ptito | 9028 | esas | 10178] 10807] 11476) r2104 19736 | 14505 [saan lavaiabiiy rom Icon PowscPianse| 220 | 820 | see | sia | er2 | evz | ave | ere | or2 [Demand be et cm ermal power lpiants RVC gas. | 9708 | 9266 | 9612 | 9995 | 10883] 11972 | 12126 | 12025] 1374 based plants _| | [Anticipated Capacity T average avslaguisge | 17°87 | 11872] 12918 | 12607| 19662 | 14571 | 15896 | 16860] 175<8 laverage aveilabity in | 1 | last three years (MW) 4 u eal Capaciy Available (MW) iesuell [Capacity Prasea-ou | 1203 -e40 | 0 | 260 | -260 | -280 | 250) 250] 0 [capaci Addtion 180 Ther \avataoie akan” _| 12218 11578 | +1678 | 44326 | +4228| 10978] to720] 10470 | 10478 Supus!(Oafeiy | 10er | -2e4 | “738 | 1470] -2404 | 660 | 4808 | “6082 | 7i70 Hiewp on ATC basis | 0 | 204 | 444 | -7at | -066 | -1v60 | 1215 | 1274 | 088 The Energy Assessment Committee may review the assessment of peak demand and availabilty as and when required. Meeting ended with vote of thanks to the chair. (Bhs Sawant) (CMO - RVPN, Chairman Discoms & MD - RUVNL peo (Navin Arora) (V. S. Bhati) MD JVVNL MD AVWNL see ‘Avinash Singhvl) (8. (AR. &.., vu CMD RVUNL at | . Sharma) MD JDWNL = C.E(LD) RVPNL Page | 8I Z lf aware era asa eRe SPM to | 028 | 58s | s0178/ soen7| 1475] szsed | s2es7| 43798) t0s8e ana | iz | a2 | en | ase ‘10685 | $1872] 12125 | +2905] 13774 jrecuires at weightage crmeeaasey 11957 | 11872 | 12318 | 12007 | 13082] 14871 | 18896 | 19560| +7008. yeu Phased Ou | 9208 | -ea0 [0 | exo | aan] amo | eo fect 180 [rsa _| 1206 | 17a] veeva| vane | cra sore | sora ona soe [Soper coeeen) | 7084 | ane | an [ero | zeae | ena [anne [coma pao Feporteeme To aus | aee [ra | se | item | ete | are [| ‘Tho Enorgy Assessment Committee may review the assessment of peak demand and availablity as und when required. ‘Meeting ended with vote of thanks to the chal, (Bry jewent) , (RK Sharmay cw. Disopge & MD ~ ‘GMD RVUNL RUVNL \ en \ (Gavin Arora) ma) MD sVWNL MD AWNL Mo CE(LD) RVPNLDraft RAS for 1,000 MW/6,000 MWh Energy Storage System Annx -4 Ba Request for Selection for Selection of Developers for ISTS connected Energy Storage Solutions of 1000 MW / 6000 MWh located anywhere in India (RFS No.: Tender Search Code (TSC): issued by: Rajasthan Urja Vikas Nigam Ltd 1s'Floor, HUDCO Building, Jyoti Nagar, Jaipur, Rajasthan 302005, e-mail: ce.ruvni@rajasthan.gov.in yom Page 1 of 89