Ministry of Power proposes BESS bidding guideline amendments – Power Peak Digest


The Ministry of Power has issued a draft notification proposing amendments to the Guidelines for Tariff Based Competitive Bidding Process for the procurement of power from grid-connected power projects and for the procurement of battery energy storage systems (BESS). The Ministry forwarded the draft to stakeholders on November 10, 2026, and has invited comments within 15 days, by November 25, 2026.  
The draft covers four sets of guidelines: Solar PV Power Projects, Wind Solar Hybrid Projects, Firm and Dispatchable Power from Renewable Energy Projects with Energy Storage Systems, and the Procurement and Utilization of BESS.
BESS procurement
Two amendments are proposed to the BESS guidelines, which were notified in March 2022 and amended in May 2022. The first modifies Clause B 2 of Section III (Bidding Process and Award of Projects) to require that the Request for Selection (RfS) include suitable provisions for compliance with domestic content requirements for BESS projects, in line with Central Government orders. 
The bidding parameters in the clause are unchanged. The procurer may invite bids in terms of BESS capacity, with the parameter being an availability-based fixed charge or annuity (Rs per kW or per MW per year or per month) and/or the quantum of Viability Gap Funding (VGF) support required by the bidder for a pre-specified fixed tariff or annuity. The bidding agency may specify one of these in the RfS, depending on the BESS application and the procurer’s off-take arrangements. The envisaged minimum term of the Battery Energy Storage Purchase Agreement (BESPA) remains 8 years, which could be increased as required by the procurement.
The second amendment modifies Section IV, Clause G 2 a ii on the Payment Security Mechanism. The existing clause says the intermediary procurer will collect a non-refundable Rs 5.0 lakh per MWh from BESS developers (BESSDs) for the Payment Security Fund (PSF). The draft changes “will” to “may” and caps the amount at “not exceeding” Rs 5.0 lakh per MWh. It also allows collection in instalments as specified in the RfS and makes the payment optional for developers.
The option of availing the PSF must be stated clearly in the RfS. If the developer opts in, the amount collected will go to the PSF, along with accrued interest, set up by the Government of India for that intermediary procurer.
Solar and hybrid projects
For solar PV projects, Clause 1.1.3 of the existing guidelines is proposed to be amended to enable procurement of solar power from grid-connected solar PV projects, with or without energy storage, through tariff-based competitive bidding. A proviso is being added requiring compliance with Central Government orders and regulations issued by the Authority that mandate installation of energy storage systems (ESS) along with solar PV projects, as well as domestic content requirements for such ESS.
For wind solar hybrid projects, Clause 3.3 is proposed to be amended so that energy storage “shall” be added, instead of “may” be added, to the solar component of the hybrid project, in accordance with Central Government orders and regulations issued by the Authority. Such storage must comply with domestic content requirements under Central Government orders. The draft also deletes the existing sub-clauses that listed the purposes of adding storage: reducing output variability, providing higher energy output for a given capacity at the delivery point, and ensuring availability of firm power for a particular period.
Firm power
Clause 1.1.8 of the guidelines on firm and dispatchable power from renewable energy (RE) projects with ESS is proposed to be amended to add a requirement that storage comply with domestic content requirements under Central Government orders. The rest of the clause is unchanged. It enables procurement of such power by distribution companies (discoms) through tariff-based competitive bidding from grid-connected RE projects with energy storage, and defines firm and dispatchable RE power as supply of electricity as per the demand profile specified in the RfS or bidding documents.
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