SOLAR POWER PARK IMPLEMENTATION

GUIDELINES

Bihar Renewable Energy Development Agency

 Concept of Solar Park
The solar park is a concentrated zone of development of solar power generation projects
and provides developers an area that is well characterized, with proper infrastructure and
access to amenities and where the risk of the projects can be minimized. Solar Park will
also facilitate developers by reducing the number of required approvals.
Ext Trans Network

CTU/STU S/S 220 /400 / 765

kV
AC AC AC
Internal P/S Internal P/S Internal P/S
33/220/400 kV 33/220/400 kV 33/220/400 kV
AC AC AC

B1 B2 B3 B4

A1 A2 A3 A4 A5 A6

A & B are Solar

Solar Park Projects
 Solar Park Implementation Models
 Mode 1:The state designated nodal agency undertakes the development
and management of the solar park. This agency could be a State
Government Public Sector Undertaking (PSU) or a Special Purpose Vehicle
(SPV) of the State Government.

 Mode 2: A joint venture (JV) company is set up between the designated

state nodal agency and SECI for the development and management of solar
park with 50% equity from SECI and 50% equity from the State Government
Agency (state government may also allow more than one agency to
contribute provided total equity from state government remains 50%).

 Mode 3: The State designates SECI as the nodal agency and SECI
undertakes the development and management of solar park on behalf of
State Government on mutually agreed terms.

 Mode 4: Private entrepreneurs promote solar parks without any equity

participation from SECI, but may have equity participation from the state
government or its agencies.
 Solar Park Implementation Models
 In order to bring more transparency, in selection of private entrepreneurs for
development of solar parks under Mode-4 of the Solar Park Scheme, the private
entrepreneurs may be selected in following manner:

 Mode 4A: If the land is made available by the State Government or any Government agency,
then the Solar Power Park Developer (SPPD) may be selected based on open bidding on
development and O&M charges. The lowest bidder would be selected based on the lowest NPV
of Park Development cost plus O&M charges per MW and the SPPD would be allowed to
sell/lease land to Solar Project Developer (SPDs) at a cost arrived at by adding the land cost
as fixed by the State Government and his quoted development charge.

 Mode 4B: If the land is to be provided by the solar park developer itself then the bidding for
selection of the SPPD would be based on his quoted price of developed land per MW and O&M
charges. That is, bidders would have to quote the price of developed park land and the O&M
charges per MW, they would charge from the SPDs. The park developer who quotes the lowest
NPV of developed land price plus O&M charges per MW would be the successful bidder for
solar park development.
 Solar Park Implementation Models
Mode 6: Solar Parks by private entrepreneurs without CFA

a) Private entrepreneurs may also develop solar parks without any CFA. In such cases, status of
solar park will entitle them to in get the connectivity and LTA from CTU. The private
entrepreneurs may submit proposals along with the Detailed Project Report (DPR) and
documents in support of 100% land in possession. After examination of DPR and land
documents, an "in principle" approval will be given. However, the status of SPPD for applying
for connectivity and LTA etc. with CTU may be issued by Ministry after financial closure,
award of works for road, water and internal transmission infrastructure by the park
developer.
b) The minimum capacity of such solar parks will be 100 MW. However, smaller solar parks of
capacity of 50 MW may be allowed in hilly states and states where there is acute shortage of
non-agricultural land.
c) If the park is not completed within 18 months of in-principle approval, the approval may be
cancelled and the grid connectivity allotted may be given to other. Extension may be given
only in case of Force Majeure condition.
The CFA of preparation of DPR is revised on the basis of capacity of the solar park in the following
manner: Si. No. Capacity range of Solar Park CFA for preparation of DPR
(in Rs.)
1.   Up to 100 MW Up to Rs. 10 lakh
1.   More than 100 MW & up to 500 MW Up to Rs. 15 lakh
1.   More than 500 MW Up to Rs. 25 lakh

 The DPR must be prepared in 120 days from the date of in-principle approval accorded by this
Ministry.
 Role of the State Government
 Land for setting up of the solar park will be identified by the State
Government unless the implementing agency has its own land.

 In order to provide for such a large tract of contiguous land with

appropriate insolation levels, the State Government may prioritize the use
of government waste/ non-agricultural land in order to speed up the
acquisition process.

 The price of the land is to be kept as low as possible in order to attract

the developers and, therefore, the site should be selected in such a
manner so that inexpensive land can be made available.

 Possibility of using cold and hot deserts, sides of highways can also be
actively explored. The solar parks are preferred to be closer to Central
Transmission Utility (CTU).

 All infrastructural requirements outside the park such as connecting road,

provision of water supply, construction electricity, etc. to make the park
functional, will be the sole responsibility of the concerned State
 Role of Solar Park Implementing Agency
 The State Government will propose solar parks under the scheme including
private solar parks. The State Government will also decide the solar power
park developer (Implementing Agency).

 The SPIA will be responsible for creating the internal transmission network
on behalf of the solar project developers. This network will connect with
the Intra State Transmission System (ISTS) or State Transmission System.

 Following are the essential responsibilities of SPIA:

 Acquisition of land
 Getting land related clearances
 Developing approach road to each plot
 Developing internal transmission system and maintaining it.
 Making arrangement to connect to the grid i.e. ISTS or State
Transmission Network.
 Providing basic drainage.
 Providing water supply (minimum essential quantity)
 Carrying O&M activity of the solar park.
 Role of Solar Park Implementing Agency
 Following are the optional responsibilities of the SPIA:

 Levelling and developing of land (to be avoided as far as possible).

 Construction of offices, housing and common building

infrastructures.

 O&M or related functions.

 Solar radiation data

 Road to all plots and within plots to each array

 Maintenance of internal power supply and water supply

 Security

 Cleanliness and waste disposal

 Technical support services (consultancy etc.)

 Solar Park Development
 In order for a solar park to move from concept to construction, it must pass through
a number of development phases:

 Pre – Feasibility Study – is the first assessment of the project. This

comprises of a high – level study of the most crucial aspects of the project
including – solar resources assessment, grid connection and construction.

 Feasibility Study – If the result of the pre – feasibility study is positive, a

detailed feasibility study is carried out. This consists of a significantly
more detailed assessment of all aspects of the project.

 Development – The development phase takes the project from the

feasibility study to financial closure.

 Detailed Design – The key systems and structures will be designed in

detail. This will generally be completed by a contractor.

 Construction – The physical construction of the project.

 Business Model for Implementing a Solar Park
 Once the mode of solar park development is finalized between the relevant
authorities of the state and central government, the joint implementing agency
forms a solar special purpose vehicle (SPV) for the development of the entire solar
park. The key function of the newly formed SPV would include:

 Land Purchase: The SPV will acquire the land for setting up the proposed
solar park either by utilizing government land, leasing land from farmers
or acquiring private land and providing corresponding compensation.

 Land Development and Civil Works: The SPV will undertake land
development and civil work in the proposed site for setting up the solar
park. This will include leveling and grading the land parcel, building an
external boundary wall etc.

 Evacuation Arrangement: will be planned in adherence with the state

STU norms, set-up the evacuation infrastructure for the solar park.

 Water Supply Arrangement: Set-up water supply network infrastructure

to meet the water requirement for the solar projects and internal
consumption in the solar park.

 Entering in to appropriate contracts/agreements

 Business Model for Implementing a Solar Park
 Once the mode of solar park development is finalized between the relevant
authorities of the state and central government, the joint implementing agency
forms a solar special purpose vehicle (SPV) for the development of the entire solar
park. The key function of the newly formed SPV would include:
 Land Purchase: The SPV will acquire the land for setting up the proposed
solar park either by utilizing government land, leasing land from farmers
or acquiring private land and providing corresponding compensation.

 Land Development and Civil Works: The SPV will undertake land
development and civil work in the proposed site for setting up the solar
park. This will include leveling and grading the land parcel, building an
external boundary wall etc.

 Evacuation Arrangement: will be planned in adherence with the state

STU norms, set-up the evacuation infrastructure for the solar park.

 Water Supply Arrangement: Set-up water supply network infrastructure

to meet the water requirement for the solar projects and internal
consumption in the solar park.

 Entering in to appropriate contracts/agreements

Framework for Project Development
 Phase 1: Solar Park Development

 Solar park development:

 The solar park SPV would be responsible to undertake infrastructure

development for setting up the Solar Park. This shall include land
acquisition, land development, power evacuation infrastructure and
water supply infrastructure.

 Funding:

 The state government may provide the initial funding for meeting the
funding requirement for setting up the solar park. A budget allocation
from the state government can be earmarked for providing the funds
for undertaking the preparatory work for development of the solar
park. Also, the fund could be sourced from the grant provided by
MNRE under the ‘Scheme for Development of Solar Parks’. The grant
could be of up to Rs.20 lakhs/MW or 30% of the project cost including
grid connectivity cost, whichever is lower.
 Phase 2: Solar Project Development

 Registration Fees: A one-time registration fee (per project or per MW)

may be collected by inviting applications from the prospective
developers when the scheme is finalized.

 Allotment of plots to the solar project developer: The plots in the

solar park can be allotted to developers after charging a one-time
charge or a combination of the following:

 Upfront Allotment Fee – One time

 Service Charge with annual escalation

 Charges for other services: It can be expected that solar park SPV
(between state and central governments) will continue operating as an
entity and having separate service agreements with project
developers for providing various services (water, power evacuation).
 Revenue Streams

 There are three main avenues for the solar park SPV to generate revenues to overcome
the initial capital expenditure incurred namely – registration fee for all eligible
developers, land lease payments, payments for allowing the utilization of power
evacuation facilities and payments for the provision of basic amenities.

 Land Lease Fee: If the solar park owner has either acquired the land or leased it
from a private individual(s)/farmer(s) and/or developed the entire land parcel
suited for developers to use it as a plug – and – play method.

 Power Evacuation Facility: The solar park owner incurs the initial capital
expenditure to set up the evacuation facilities including the pooling substations
located within the solar park and grid substation to evacuate the total power from
the solar park.

 Basic Amenities: The solar park owner takes the onus of providing the potential
developers with basic amenities like water supply, storage area, domestic and
administrative buildings, road linkages, central weather monitoring station, power
and telecommunication facilities, parking and warehousing.

 Other Facilities: If the solar park owner further leases out the land to potential
manufacturers, skill training and capacity building institutes etc.
 Revenue Streams

 The solar park owner can charge developers for the above mentioned facilities
in two main ways –

 An upfront fee: where the developer pays a one – time upfront fee to the
solar park owner at the time of COD, or

 Upfront + Annual fee collection: where the developer will pay an upfront
fee, which is not so significant in amount, as well as annual charges
determined by the solar park owner for the lifetime of the solar project.
 MNRE CFA
A Grant of up to Rs. 25 Lakhs for preparing Detailed Project Report (DPR)
of the Solar Park, conducting surveys etc. The DPR must be prepared in
60 days.

A Grant of up to Rs. 20 lakhs/MW or 30% of the project cost including

Grid-connectivity cost, whichever is lower.

Sl. Milestone % of subsidy

No. Disbursed
1 Date of issue of administrative approval 5%
Land acquisition (not less than 50% land
2 acquired) 20%
3 Financial Closure 20%
Construction of Pooling Substation, Land
4 Development and other Common 25%
other Common facilities as per DPR
Construction of transmission line and Grid
5 Connectivity 20%
6 Final installment on completion 10%
Total 100%
 MNRE CFA
A Grant of up to Rs. 25 Lakhs for preparing Detailed Project Report (DPR)
of the Solar Park, conducting surveys etc. The DPR must be prepared in
60 days.

A Grant of up to Rs. 20 lakhs/MW or 30% of the project cost including

Grid-connectivity cost, whichever is lower.

Sl. Milestone % of subsidy

No. Disbursed
1 Date of issue of administrative approval 5%
2 Land acquisition (not less than 50% land acquired) 20%
3 Financial Closure 20%

Construction of Pooling Substation, Land

4 Development and other Common 25%
other Common facilities as per DPR
Construction of transmission line and Grid
5 Connectivity 20%
6 Final installment on completion 10%
Total 100%
 Central Finance Assistance (CFA)

 CFA @ Rs. 25.00 Lakhs per solar park would be released by MNRE to
SECI for preparation of DPR of the solar park, conducting surveys, etc.

 Also,CFA of up to Rs. 20.00 lakhs per MW or 30 % of project cost,

including grid connectivity cost, whichever is lower.

 The CFA of Rs. 20.00 Lakhs may be apportioned in the ratio of 60:40
i.e. Rs. 12.00 Lakhs per MW or 30 % of Project Cost whichever is lower
may be provided to SPPD towards development of Solar Park and Rs.
8.00 lakhs 30 % of Project Cost whichever is lower will be provided to
CTU/STU towards the development of external transmission systems.
Benchmarks and timelines for Solar power projects

Sr. Benchmark Timeline (from zero day)

No.
Solar PV Solar
Thermal
1 Date of issue of administrative Day 0 Day 0
approval
2 Financial closure 6 Months 6 Months
3 Construction of Pooling Substation, 12 Months 12 Months
Land Development and other common
facilities as per DPR
4 Commissioning of 25% of the Solar 16 Months 18 Months
Power Capacity
5 100% commissioning 24 Months 24 Months