Rebidding Languishing Solar and Wind Projects: Why Bundling Storage Is More Than a Fix — It’s a Strategy

I read the report that the Ministry of New and Renewable Energy (MNRE) is considering rebidding a tranche of vanilla solar and wind capacities — and that it plans to bundle these with battery energy storage systems (BESS) to revive projects that have stalled or under‑performed MNRE mulls rebidding for languishing vanilla solar & wind power projects. The summary on WeRIndia pointed to the same thrust: rebid by clubbing capacities with BESS to make them bankable and grid‑relevant again MNRE mulls rebidding for languishing vanilla solar & wind power projects.

That sentence — "rebid by clubbing with BESS" — contains more than a procurement tweak. It signals a necessary rethink about how we architect India’s renewable transition: from isolated generation auctions to integrated, grid‑aware capacity creation.

Why many projects languished in the first place

It’s easy to point at a single cause, but the reality is systemic:

• Commercial and contractual friction: PPAs, delayed clearances, and uncertain grid interconnection timelines make lenders nervous.
• Grid constraints and curtailment: generation without firming cannot always be dispatched when needed.
• Financing stress and price discovery: earlier auctions priced generation for energy only; storage changes price dynamics and capital needs.
• Technology and lifecycle mismatch: many vanilla projects were designed without an eye on future repowering or integration with storage.

Simply rebidding the same specifications without addressing these root problems is why the idea to club BESS with capacity has traction.

Bundling BESS matters — but it is not a silver bullet

Bundling storage with generation can transform an intermittent kilowatt into a dispatchable resource. That has big benefits:

• Grid firming and reliability: BESS lets renewable plants supply power during demand peaks, reducing need for fossil peaker plants.
• Higher realized value: generators can capture time‑of‑day premium pricing rather than selling at low mid‑day tariffs only.
• Lower curtailment risk: storage reduces wasted generation and improves plant economics.

Yet this raises real challenges:

• Higher upfront capital and complex financing structures.
• Procurement complexity: how to price generation + storage fairly, manage warranties, and allocate responsibilities across EPC, storage suppliers, O&M and lenders.
• Regulatory clarity: transmission charges, ancillary services markets, and charging/discharging rules must be clear.
• Domestic supply chain and safety: BESS has safety, recycling and raw‑material considerations that policy must address.

What the MNRE proposal must get right (practical checklist)

If rebidding is to succeed, I believe several elements must be explicit and workable:

1. Clear contractual architecture

• Standardized hybrid PPA templates for generation + storage.
• Risk allocation that attracts long‑term capital (who shoulders degradation risk, FCAS obligations, etc.).

1. Bankable auction design

• Separate but linked price discovery for energy and storage or a transparent hybrid tariff model.
• Allow bids with storage-as-a-service structures and long tenor financing.

1. Regulatory certainty and market signals

• Integrate storage into ancillary services markets and compensatory mechanisms.
• Transmission and wheeling rules that don’t penalize hybrid assets.

1. Local industry and lifecycle planning

• Incentives for domestic manufacturing and safe recycling of battery packs.
• Technical standards and certification to reduce project risk.

1. Repowering and legacy asset strategies

• For old wind farms and stranded solar, repowering plus storage should be an explicit pathway.

1. Community and land‑use alignment

• Ensure local communities benefit (jobs, CSR, microgrids) so projects don’t stall on social grounds.

Macro implications — beyond a single tender

Bundling storage is not just about getting stalled projects moving. Done thoughtfully it supports bigger strategic aims:

• Energy security and decarbonization: firm renewables reduce dependence on fossil backup and fossil fuel price volatility.
• Industrial strategy: large, predictable BESS demand can seed domestic manufacturing and supply chains (critical for Make in India objectives).
• Job creation and upskilling: systems integration, O&M and recycling create skilled roles across regions.

But only if policy is forward‑looking. If we repeat past auction designs and then bolt‑on storage as an afterthought, the same problems will recur.

A lesson from my own writing: policy foresight matters

This conversation reminds me of a recurring theme in my writing — that systemic problems need systemic solutions. Years ago I argued for structural reforms and proactive policy design to create environments where markets can scale predictably (see my piece on structural reforms and GST proposals for how policy levers can shift behaviour and unlock finance) GST Conundrum: A Compromise Formula. The core idea I keep returning to is the same: if you ask markets to deliver transformational outcomes, you must align regulations, incentives, and institutions in advance. The MNRE proposal is exactly the kind of policy pivot that needs that alignment.

Practical nudges I’d like to see from MNRE / regulators

• Pilot hybrid auctions: run limited bundled tenders with clear evaluation metrics to discover workable contracting approaches.
• Credit enhancement windows: concessional financing or guarantees for first‑of‑kind bundled projects to lower perceived risk.
• Storage standards and a safety + recycling roadmap to reduce lifecycle uncertainty for investors.
• Create an integrated roadmap for repowering older wind sites with storage — this can be a quick win for capacity addition.

Final reflection

Reading that MNRE is prepared to rebid and pair storage with generation felt, to me, like a small but meaningful step from short‑term fixes to structural thinking. It’s not merely about restarting dormant MWs; it is about converting stranded potential into grid‑friendly, investible capacity that serves citizens and industry alike.

If we treat this as a one‑time procurement exercise, we will only unearth the same structural frictions. If instead we use these rebids as pilots to create standardized, bankable frameworks and build domestic supply chains, we will have taken an important stride toward a resilient, modern grid.

The situation is urgent but manageable — with clarity, standardization, and a little policy imagination, India can turn these languishing projects into firm power and industrial opportunity.

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Regards,
Hemen Parekh