The Ministry of Power has released Operational Guidelines for designating companies as Renewable Energy Implementing Agencies (REIAs). These guidelines aim to streamline and standardize the process of procuring power from grid-connected renewable energy projects through Tariff-Based Competitive Bidding (TBCB), thereby accelerating India’s renewable energy development.
REIAs are crucial “market makers” that act as “Intermediary Procurers” (IPs). Their primary role involves aggregating power from various renewable energy generators and selling it to “End Procurer(s),” typically Distribution Licensees or consumers. Their responsibilities encompass:
- Executing the entire bidding process for RE projects.
- Signing back-to-back Power Sale Agreements (PSAs) with RE developers.
- Entering into Power Purchase Agreements (PPAs) with Distribution Licensees/Consumers.
- Ensuring robust payment security mechanisms for RE developers.
Eligibility Criteria for REIA Designation
To be designated as an REIA, a company must meet stringent eligibility requirements as follows:
- Must be an Indian company registered under the Companies Act, 2012.
- Possession of a valid Category-I electricity trading license issued by the Central Commission.
- Demonstrate a net worth (comprising subscribed capital and reserves, excluding revaluation reserve) exceeding Rs 500 Crore.
- Maintain a long-term credit rating of ‘A’ or above.
- Obtain approval from its Board of Directors for the REIA designation.
Other Key Terms and Conditions
The guidelines also lay down operational mandates for designated REIAs:
Procurement Process: REIAs must adhere to the procurement processes stipulated by the Central Government under Section 63 of the Electricity Act, 2003.
E-Bidding Platforms: Procurement must exclusively utilize e-bidding platforms prescribed by the Central Electricity Regulatory Commission (CERC). Until CERC specifies a platform, existing e-procurement platforms with a successful track record and robust security features may be used.
Conflict of Interest: To ensure fairness, no subsidiary or group company of a designated REIA is permitted to participate as a bidder in a process conducted by that REIA.
Ownership Changes: The stipulated eligibility criteria must be continuously maintained even after any change in company ownership, merger, or demerger.
Applicability and Tenure
These guidelines are applicable for all new REIA designations from the date of their issuance. Existing designated REIAs, including SECI, NTPC Ltd, NHPC Ltd, and SJVN Ltd, will continue their roles under previous Central Government orders.
A company will be designated as an REIA for an initial period of five years, subject to termination by the Central Government if the REIA fails to perform its duties as per relevant rules, orders, or guidelines. In the event of termination, the company remains responsible for fulfilling its duties towards RE developers and procurers as per existing agreements for already completed bidding processes.
The Ministry of Power, in consultation with the Ministry of New and Renewable Energy, retains the right to modify these guidelines as needed.
