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NHPC issues Tender for 500 MW/1 GWh Standalone BESS in Andhra Pradesh

NHPC has issued a tender inviting bids for the development of a 500 MW/1,000 MWh standalone battery energy storage system (BESS) in Andhra Pradesh. The project, part of Tranche II, will be connected to the intrastate transmission network.

To support project viability, developers will be eligible for viability gap funding of Rs27 Lakh per MWh or up to 30% of the capital cost, whichever is lower.

The deadline for bid submission is March 17, 2025, with bids scheduled for opening on March 20, 2025. Interested bidders are required to submit an earnest money deposit (EMD) of Rs341,000 per MWh. Upon selection, developers must furnish a performance bank guarantee of Rs852,500 per MWh and a payment security deposit of Rs500,000 per MWh before commissioning the initial phase of the project.

Successful bidders must ensure the BESS operates for at least one cycle per day, maintaining a minimum monthly system availability of 95% and an AC-to-AC roundtrip efficiency of 85%. Additionally, the system should be capable of supporting two daily operational cycles under the same performance criteria.

The selected developers must deploy commercially proven and operational technologies that comply with prescribed codes and standards, minimizing technological risks. The projects are required to be commissioned within 18 months of signing the battery energy storage purchase agreement.

Bidders must have a minimum net worth of Rs34 lakh per MWh for the proposed capacity, calculated based on the last financial year’s closing or seven days before the bid submission deadline.

A non-refundable processing fee is applicable based on the project capacity.

Other Important Points of the Tender:

• Offtaker: APDISCOM
• Location: Three ISTS substations in Andhra Pradesh (Jammalamadugu, Ghani, Nuppam Ghani)
• Land: Provided to the developer on a lease or Right to Use (RTU) basis
• PPA Tenure: 12 years
• Charging Energy: Supplied by APDISCOM, factoring Round-the-Efficiency (RtE)
• Operation Cycles: 2 cycles per day
• Availability Requirement: Minimum 95% monthly (shortfall penalty: 2x capacity charges)
• Efficiency Requirement: 85% monthly
• Efficiency Penalties & Incentives:
  • RtE < 70> Penalty at 1.5x Average Power Purchase Cost (APPC)
  • RtE between 70-85%: Penalty at APPC tariff
  • RtE > 85%: Incentive of Rs0.50/unit for excess energy
• Annual Degradation: 2.5% allowed
• Commissioning Timeline: 18 months from Battery Energy Storage Purchase Agreement (BESPA)
• Early & Partial Commissioning: Allowed
• Quoted Tariff: INR/MW/month model
• Viability Gap Funding (VGF): Rs27 lakh/MWh or 30% of CAPEX (whichever is lower)
• VGF Disbursement: 10% on Financial Closure, 45% on COD, and 15% annually over three years
• Financial Closure Deadline: 6 months before Scheduled COD

This marks the 11th VGF-backed BESS tender, bringing the total capacity under this scheme to 8.3 GWh. The rapid pace of tendering highlights DISCOMs' growing preference for standalone battery storage, driven by the need for grid stability, peak demand management, and renewable energy integration.

With India’s energy storage market gaining momentum, the focus on large-scale BESS deployment and financial incentives is set to attract significant investments and project development in the coming years.