Pre-bid meeting: Expression of Interest for Virtual Power Purchase Agreement (VPPA) Based Renewable Energy Procurement – EQ

Summary:

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## **Key Business Points**

### 1. **What is a VPPA?**
A **Virtual Power Purchase Agreement (VPPA)** is a financial contract for difference (CfD) where:
– The buyer does **not physically receive electricity**
– The developer sells power to the grid at market price
– The buyer pays the difference if market price is below the strike price, or receives payment if market price exceeds strike price
– Enables **corporate renewable energy procurement** without physical delivery constraints

### 2. **SECI’s Role in This EOI**
– **Not a direct tender** – This is an **Expression of Interest** to gauge demand
– SECI will **aggregate demand** from multiple buyers
– After aggregation, SECI will facilitate a **competitive bidding process** to discover the **Strike Price**
– This structure allows smaller off-takers to pool demand and access VPPA structures otherwise available only to large buyers

### 3. **Who Should Participate?**

| Participant Type | Relevance |
|—————–|———–|
| **Corporate consumers** | Seeking to meet RE targets (e.g., RE100, ESG, carbon neutrality) without physical wheeling |
| **Renewable energy developers** | Looking for long-term contracted revenue via VPPA mechanism |
| **Captive power producers** | Interested in financial hedging against grid power price volatility |
| **Financial institutions / advisors** | Evaluating VPPA market potential in India |
| **Large industrial consumers** | Want to claim renewable attributes (RECs, carbon credits) without setting up dedicated captive plants |

### 4. **Why Attend the Pre-Bid Meeting**
– Understand **SECI’s proposed VPPA framework** in India
– Clarify **strike price discovery mechanism**
– Learn about **contractual terms**, including tenor, force majeure, curtailment risk allocation
– Understand **treatment of Renewable Energy Certificates (RECs)** and carbon credits
– Clarify **counterparty risk** (SECI as intermediary vs. direct off-take)
– Network with other potential buyers for demand aggregation

### 5. **Expected Structure (Inferred from VPPA Standard Practices)**
| Element | Typical Approach |
|———|——————|
| Off-taker | Corporate buyer(s) via SECI aggregation |
| Seller | RE developer (solar / wind / hybrid) |
| Pricing | Strike Price discovered via competitive bidding |
| Settlement | Financial difference against IEX/other market price |
| Tenor | 10–25 years (typical RE PPA tenure) |
| Renewable Attributes | Buyer claims RECs / carbon benefits |

### 6. **Action Items for Interested Businesses**

| Step | Deadline / Action |
|——|——————-|
| **Register for pre-bid meeting** | Before 13.05.2026 via Google Form |
| **Attend online meeting** | 13.05.2026, 02:30 PM IST on MS Teams |
| **Prepare queries** | Send in advance to pratikpr@seci.co.in / arva.sharma@seci.co.in |
| **Monitor SECI website** | For any amendments, clarifications, or subsequent tender |
| **Evaluate internal VPPA readiness** | Risk approval for financial settlement mechanism |

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