Ultra mega renewable projects: Centre asks states to expedite land

By: |
March 5, 2020 4:01 AM

According to sources, the states have also been asked to start planning for large scale transmission infrastructure required to evacuate power from these renewable energy parks.

“Floating solar power projects in Uttarakhand may be included under UMREPP mode for making it eligible for central financial assistance (CFA),” a government document on the subject, reviewed by FE, stated. (Representative image)“Floating solar power projects in Uttarakhand may be included under UMREPP mode for making it eligible for central financial assistance (CFA),” a government document on the subject, reviewed by FE, stated. (Representative image)

The Centre has asked the state governments to speed up the process of tying up with central public sector undertakings (CPSUs) and identifying land parcels to set up ultra mega renewable energy power parks (UMREPPs).

To this end, Gujarat will form separate special purpose vehicles (SPVs) with Solar Energy Corporation of India (SECI) and NTPC for two 5,000-mega watt (MW) UMREPPs and Rajasthan will form SPVs with Power Finance Corporation (PFC) for 3,000 MW, SECI for 5,000 MW and NTPC for 10,000 MW.

According to sources, the states have also been asked to start planning for large scale transmission infrastructure required to evacuate power from these renewable energy parks. In some zones, land acquisition will have to be exercised after consultation with the defence ministry as some areas fall in the territory along the international border with Pakistan. While Gujarat is said to have zeroed in on land in Kutch district, the Rajasthan plants are likely to be installed in Bikaner, Jaisalmer and Barmer.

Among other states that are setting up UMREPPs, Maharashtra and Madhya Pradesh will form SPVs with NTPC, Tamil Nadu with NLC and PFC and Jharkhand with SECI. Andhra Pradesh will set up a 10,000-MW UMREPP on its own. An official from the ministry of new and renewable energy told FE on condition of anonymity that Kerala will set up large floating solar parks and has been asked to tie up with NHPC at the earliest.

“Floating solar power projects in Uttarakhand may be included under UMREPP mode for making it eligible for central financial assistance (CFA),” a government document on the subject, reviewed by FE, stated.

The UMREPPs will receive CFA of Rs 20 lakh/MW or 30% of the cost of infrastructure development, including the cost of building transmission lines to substations. The state government will have to facilitate the SPVs with land acquisition and receiving statutory clearances. The land may be offered by the states as its equity in the SPV or on lease. Private land are also allowed to be used for UMREPPs “on upfront charges or on lease basis”.

The SPVs will offer the UMREPPs to interested developers who would pay them upfront or annual rent as park development and operations and maintenance charges.

These charges can also be adjusted with the tariffs at which power will be sold. Besides receiving the CFAs, the SPVs may also earn trading margin of Rs 0.07/ kwh if they choose to act as power traders.

The UMREPP scheme aims to address the major challenges of land acquisition, shortage of evacuation infrastructure, non-conducive state policies that are being faced by renewable energy developers.

The capacity of individual UMREPP are expected to be in the range of 2,000 MW. However, the minimum capacity of any UMREPP at a single location may be 600 MW, if it warrants the construction of new power transmission systems.

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