F.No.

10/16/PMC/BM-2009
MINISTRY OF NEW AND RENEWABLE ENERGY
PROJECT MANAGEMENT CELL

NOTICE INVITING EXPRESSION OF INTEREST (EOI) FOR

ESTABLISHMENT OF MODEL INVESTMENT PROJECTS (MIPs)
BASED ON COMBUSTION, GASIFICATION AND CO-GENERATION
OF BIOMASS FOR GENERATION OF GRID QUALITY POWER

The Ministry of New and Renewable Energy, Government of India, is implementing

a UNDP / GEF assisted Project on “Removal of Barriers to Biomass Power Generation
in India.” The aim of the Project is to accelerate the adoption of environmentally sustainable
biomass power technologies by removing the barriers identified, thereby laying the
foundation for the large scale commercialization of biomass power through increased
access to financing.

2. As part of this Project, the Ministry is contemplating for establishment of Model

Investment Projects (MIPs) in the different parts of the country. The Biomass Conversion
Technologies that are proposed to be deployed are – Combustion, Gasification and
Cogeneration using different type of captive and distributed biomass resources. The aim of
these projects is to demonstrate the viability of new investment and financing models for
mainstreaming the biomass power sector and is also expected to act as the “Best
Practices” for faster replication in other States. Further, details regarding project
configurations for each category, and technical and financial assistance available for MIPs
from the Ministry under this Project may be viewed at Ministry’s Website: www.mnre.gov.in.

3. Expression of Interest (EOI) is invited from State Govt. Organizations / Agencies,

Independent Power Producers (IIP), Cooperative Societies / Sugar Mills, Project Promoters,
NGOs and other Investors for establishment of above-mentioned MIPs. Interested
Organizations / Project Promoters can obtain guidelines for submission of proposal from the
Project Management Cell (PMC) established in the Ministry of New and Renewable
Energy, B-14, CGO Complex, Lodi Road, New Delhi – 110003, Telefax: 011-24369788,
Email: jainvk@nic.in or download from the Ministry’s Web site: www.mnre.gov.in. Last date
for submission of the proposal is 25th September 2009.

4. The project(s) which have already achieved financial closure and / or partly
availed financial support from this Ministry under the Programme on Grid Interactive Power
Generation Projects based on Renewable Energy Sources will not be considered for MIPs
under this Project. The Organizations / Developers who had applied for IREDA – KfW, Line
of Credit can also apply in response to this notice.

5. The Ministry reserves the right to reject all or any of the proposals without
assigning any reason thereof.
 F.No. 10/16/PMC/BM-2009
MINISTRY OF NEW AND RENEWABLE ENERGY
PROJECT MANAGEMENT CELL

NOTICE INVITING EXPRESSION OF INTEREST (EOI) FOR

ESTABLISHMENT OF MODEL INVESTMENT PROJECTS (MIPs)
BASED ON COMBUSTION, GASIFICATION AND CO-GENERATION
OF BIOMASS FOR GENERATION OF GRID QUALITY POWER

1. Background

The availability of biomass in India is estimated at about 540 million

tonnes per year covering residues from agriculture, agro industrial, forestry, and
plantations. Principal agriculture residues include rice husk, rice straw, bagasse,
sugar cane tops and leaves, trash, groundnut shells, cotton stalks, mustard
stalks, etc. It has been estimated that about 70-75% of these wastes are used
as fodder, as fuel for domestic cooking and for other economic purposes leaving
behind 120 – 150 million tonnes of usable agro industrial and agriculture
residues per year which could be made available for power generation. By using
these surplus agricultural residues, more than 16,000 MW of grid quality power
can be generated with presently available technologies. In addition, about 5000
MW of power can be produced, if all the 550 sugar mills in the country switch
over to modern techniques of co-generation. Thus, the country is considered to
have a biomass power potential of about 21,000 MW.

1.2. The Ministry is implementing a scheme for promotion of Grid Interactive

Power Generation Projects based on Renewable Energy Sources that covers
projects based on biomass. In last 10 years, about 102 projects aggregating to
703 MW have already been in operation and about 60 projects aggregating to
578 MW are currently under implementation in different parts of the country.
The States which have taken a leadership position in implementation of biomass
power projects are Andhra Pradesh, Karnataka, Tamil Nadu, Chattishgarh,
Maharashtra and Rajasthan. The details of the scheme on Grid Interactive
Power can be viewed at this Ministry’s Website: www.mnre.gov.in

1.3. Fiscal incentives such as accelerated depreciation, import duty

concessions, excise duty exemption, tax holiday for 10 years etc. are being
provided, besides capital subsidy for power generation projects based on
biomass. The State Electricity Regulatory Commissions (SERCs) in Andhra
Pradesh, Haryana, Punjab, Madhya Pradesh, Maharashtra, Rajasthan, Tamil
Nadu, Gujarat, Kerala, Punjab and West Bengal have announced preferential
tariff for biomass power and bagasse cogeneration power projects, besides
RPO’s also have been announced in these states.
 
1.4. The 11th Five Year Plan (2007-2012) is aimed at establishing renewable
based grid interactive power generating power capacity of 14000 MW with
biomass power having a share of 2100 MW (3%). Achieving this target would
involve overcoming several major barriers impending deployment of biomass
power, such as inadequate information on biomass availability, non-formal
biomass market, problems associated with collection and transportation and
storage of biomass, problems associated with setting up large size biomass
plants, non-availability of cost effective sub MW systems for conversion of
biomass to energy, non-versatility of boilers to simultaneously taking a variety of
biomass stocks, inability of some sugar mills to generate bankable projects on
account of financial and liquidity problems, low capacity factors of some existing
biomass projects etc.

2. UNDP / GEF assisted Project on “Removal of Barriers to Biomass

Power Generation in India.”

2.1 This Ministry is currently implementing a UNDP / GEF assisted Project on

“Removal of Barriers to Biomass Power Generation in India.” The key
objective of the Project is to accelerate the adoption of environmentally
sustainable biomass power technologies by removing the barriers identified,
thereby laying the foundation for the large scale commercialization of biomass
power through increase access to financing. Biomass for the purpose of the
Project would comprise agricultural residue, agro-industrial waste/by-products,
fuel wood obtained from dedicated plantations especially raised for the purpose.
The Biomass Conversion Technologies that are proposed to be deployed are –
Combustion, Gasification and Cogeneration using different type of captive and
distributed biomass resources (See definition at Annexure-B).

3. About Model Investment Projects (MIPs) and Implementation

Approach

3.1 As part of this Project, the Ministry is contemplating for establishment of

Model Investment Projects (MIPs) for generation of grid interactive power. The
aim of these projects is to demonstrate the viability of new investment and
financing models for mainstreaming the biomass power sector and is also
expected to act as the “Best Practices” for faster replication in other States.
Therefore, these projects will be representing a cross-section of the type of
technologies, feedstock, and regional diversity considered essential to
stimulating the range of biomass options found within India. In the biomass
sector (other than the sugar mill sub sector), the MIPs has been categorized into
less than 1 MW and greater than 1 MW of installed plant capacities. While MIPs
with less than 1 MW are to be based on gasifier technology, others may be
based on cogeneration or combustion technologies. Thus the MIPs would reflect
the specific characteristics of these sub-segments in addressing the barriers and
correspond to different approaches adopted for each biomass sector.

4. Details regarding indicative project configurations for each category and

likely technical and financial assistance available for MIPs from the Ministry
under this Project are as under-:
4.1 Indicative Parameters for Establishment of Model Investment
Projects

Technologies : Combustion, Gasification and Cogeneration

Type of Biomass Resources

• Captive Source (Sugar/Rice Mills/Solvent Extraction Plants etc)

• Field Distributed / Decentralized Sources (Cotton Stalk/Can
Trash/Rice Straw / Mustard or Rapeseed Stalk / Wild Plantation
(Prosopis Juliflora etc.)

Target Users / Sponsors

• Cooperative Sugar Mills

• Agro Processors / Biomass Producers/Growers
• Independent Power Producers (IPP/Power Generation
Companies)

Project Sites for MIPs: The Project coverage includes all States and Union
Territories of the country and will be selected
depending upon the innovativeness and
demonstration value of the Project. The Projects
based on Decentralised Distributed Generation
(DDG) / Local Grid Compatible Solutions for
providing electricity to rural households will also be
considered.

4.2 Summary of Possible Project Configurations for MIPs

MIP – I : Sugar Mill Bagasse / Biomass based Cogen Plant using High
Pressure Boilers

Capacity : Installed – 25 MW

Surplus - 14 MW in season
Surplus - 20 MW in off-season

Boiler / TG Configuration : 87 kg /cm2 and 515 0C or

110 kg /cm2 and 540 0C

Minimum 330 days per year operation on mill bagasse /

procured bagasse and other biomass

Project Implementation - EPC route

 MIP – II : Biomass Power Plant based on Multi Fuel Procured Feed
Stock

Capacity : 5 MW (Exportable)

Boiler / TG Configuration : 87 kg /cm2 and 515 0C or

67 kg /cm2 and 485 0C

Minimum 300 days per year operation on captive / procured

biomass

Project Implementation - EPC route

MIP III-VII : Grid Connected / Decentralized Distributed Generation

(DDG) based Gasifier Engine Systems

Capacity: 1 MW (combination of 100/200/500 kWe systems)

Type of Biomass:

MIP III - Rice Husk / Dal Husk

MIP IV - Rural Coop. Cotton Stalks & other Biomass
MIP V - Energy Plantation & Paddy Husk
MIP VI - Rural Coop., Mustard Stalks & Energy Plantation
MIP VII - Coconut Shells, Coir etc.

5. Technical and Financial Support

The support from the UNDP / GEF Project in establishment of these MIPs will
have two components – Technical and Financial Assistance as outlined below:

5.1 Technical Assistance for Barriers Removal Activities:

The Technical Assistance (TA) focuses on activities that address the

barriers specific to the MIPs. Technical support to investors will be
provided for project development, project appraisal, and for verifying
biomass assessment and depot mapping to ensure secured supply of fuel,
finalization of Power Purchase Agreement and EPC Contracts, Capacity
Building and Information Sharing etc. Technical support will also be
available for FIs for effective implementation of MIPs through provision of
additional resources for specific component including monitoring MIPs,
risk and barriers assessment specific to MIPs and pre-project activities
support.
 The TA funds for MIPs will be one-time grant to the development and
successful commissioning of MIPs, which will enable all the stakeholder to
learn about the intricacies of the project and related investments.

5.2 Financial Support for MIPs

A customized restructured financial model defining quantum and mode of

financial incentives for these MIPs is currently under development. It is
expected to have one or more component of grant and / or loan to support
towards Equity, Securities / Guarantees for raising loan from FIs, for
bridging viability gaps etc, besides incentives / support to FIs for
strengthening their capabilities and expertise in handling biomass Project.
The said approach and technical & financial features are expected to
boost the confidence levels of Fls in the biomass sectors and will help
them in post project replication phases. Fls are expected to develop new
mechanism for partial or total funding for such investments in the post
project phase or to link them with their existing financing schemes and
terms as appropriate.

6. The Criteria for the Selection of MIP

The broad criteria for short listing of MIPs will be as follows:

i) Financial viability of the Project/Financial Capability of the Promoter,

ii) Innovative character of the project [sub-criteria: a) Technology, b)

Institutional Framework, c) Fuel supply chain and d) Waste/ Emissions
Management

iii) Replicability (in the proposed state)

iv) Social and Environmental Impact

v) Past Experience of Promoter and Manufacturer (track record)

7. The Organizations / Developers who had applied for IREDA – KfW, Line of
Credit can also apply in response to this notice. However, such proposals will be
considered only when they do not get financial support from IREDA.
8. Organisations interested in establishment of the aforesaid MIPs may submit
their proposal in the Proforma for submission of EOI for Establishment of Model
Investment Project (MIPs) as given at Annexure – A to Project Management Cell
(PMC) established in the Ministry of New and Renewable Energy, B-14, CGO
Complex, Lodi Road, New Delhi – 110003, Telefax: 011-24369788, Email:
jainvk@nic.in by 25th September 2009.
 Annexure -A
F.No. 10/16/PMC/BM-2009
Ministry of New and Renewable Energy
Project Management Cell

Proforma for Submission of Expression of Interest (EOI) for Establishment of Model

Investment Projects (MIPs) under the UNDP/GEF assisted Biomass Power Project on
“Removal of Barriers to Power Generation in India”

(To be filled in duplicate)

A. General Information

A1. Name of the Project / Power Plant : ________________________________________

_________________________________________

A2. Type of User / Beneficiary
A3. Contact Details
: State Govt. Organisations / Agencies / Cooperative Sugar Mills
/ Agro-Processors / NGO’s / Biomass Producers /
Independent Power Producers(IIP) / Power Generation
Companies, others (Please specify)

Project / Power Plant Location : _______________________________________________

Village : _______________________________________________
Taluka/Block : ________________________________________________
District : ________________________ Pin Code _______________
State : _______________________________________________

A4. Contact Person Details

Name & Designation of the Applicant : _________________________________________

Phone : _________________________________________
Contact Address :_________________________________________
Fax : ________________________________________
Email : ________________________________________

B. Details of Proposed Project / Power Plant

B1. Installed Capacity of the Plant (MW) : ________________________________________

B2. Technology to be used : Combustion / Gasification / Cogeneration

B3. Boiler Operating Configuration : Pressure (kg/cm2)_______Temperature (0C)_______

for Projects based on Combustion
/ Cogeneration

B4. Type of Gasification Technology : BIGCC / IPCC / FBG /Producer Gas Engine
including IC Engine Configuration / Dual Fuel Engine
for projects based on Gasification
 B5. Whether Approvals obtained /tie-ups finalized

: NoC from State Govt. /State Nodal (Yes/No)

Agency (SNA)
Electrical Inspector Approval (Yes/No)
Pollution Control Board NoC (Yes/No)
Environmental Clearance (Yes/No)
Power Purchase Agreement (Yes/No)
Financial Closure (Yes/No)
Ordering of main equipment (Yes/No)

B6. Expected Total Project Cost (Rs) :__________________________________________

B7. Means of Finance : Equity / Term Loan / Any other agency

B8. Name of Financial Institution Approached : _______________________________________

B9. Agreed Conditions for Loan(s) :

Approved schedule for disbursals of loan(s)___________
Interest rate ______________________
Moratorium ______________________
Repayment period ______________________
Security ______________________
Any Other ______________________

B10. Status of Tie- up Order with Technology and Equipment Supplier for the proposed Project

S. Items Manufacturer Specifications

N. Make/features
1 Boiler / Gasifier Gas Clean Up
Unit
2 Biomass Feed Handling System
3 Steam Turbine Generator /IC
Engine –Generator Set
4 Compressor
5 Drying Plant
6 DM Plant
7 Transformer
8 Cooling tower
9 EOT Cranes
10 Switch Gear System
11 A/c and Ventilation System
12 Cooling water pumps
13 Miscellaneous Pumps and
Auxiliaries
 B11. Terms of Power Purchase Agreement, if already made

Types of buyer __________________________

Utilities / SEDCL_________________________
Traders _________________________
Power Exchange ________________________
Rate, Rs./kwh _________________________
Term, months / years _____________________

B12. Status of Grid for Power Evacuation

Voltage level distance cost ________________

Distance ________________
Cost borned by ________________

C. Details of Fuel Availability

C1. Type of Biomass proposed to be used : Bagasse/ Cane Trash / Cotton Stalks / Rice Husk /Other
Crop / Residues /Wood Produced in dedicated Energy
Plantation / Wild Bushes (Prosopis Juliflora), Other (please
specify)

C2. Type of Biomass Resource to be used : Surplus Field Distributed Biomass / Captive Biomass

C3. Likely Composition of Biomass to be used (% percent of various types of biomass)

Name of Biomass Annual Availability (%)

C4. Will you propose co-firing with fossil fuel like coal:

Share of biomass (percent) : __________________________________________

Other fossil fuel (s) used : __________________________________________

C5. Source of Fossil Fuel : ___________________________________________

C6. Availability of Biomass in nearby areas: (High/ Medium / Low)

C7. Is there seasonal variation in the availability of biomass: Yes / No

If yes, please provide details of seasonal availability of different biomass types

Biomass type Biomass Months of Approx. Mode of

price availability procuring transportation
(Rs/ton) distance (km)
D. Details of Fuel Supply Linkages

D1. How biomass is to be collected from the field?

_____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________

D2. How biomass is to be transported from field to the project site?

___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________

D3. Details of biomass storage (how and where):

• Onsite storage:
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________

• Offsite Storage
___________________________________________________________________________
___________________________________________________________________________
__________________________________________________________________________

• For how many days (average) storage before usage:____________________

D4. Details of fuel(Biomass) processing before usage:

Biomass type Preprocessing done before Approximate processing cost / ton

final usage

D5. Details of average cost involved in the collection, storage and processing of the biomass fuel.

Biomass Type Collection Storage Cost Preprocessing Total Cost of Biomass

Cost (per ton) (per ton) Cost if any (per Fuel (per ton)
ton)
 D6. Contact details of biomass suppliers in the Catchment /Command Area :

Name of the Supplier Type & Quantity of Contact Details Supply Agreement
Biomass to be supplied Finalized (Y/N)

D7. Innovative / Novel Features / Practices to be Incorporated in the Plant / Facility

a. Fuel Supply Chain :

Development of Entrepreneurs’ for Secured and Sustained Fuel Supply ___________

____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________

Development of Biomass Depots. ________________________________________

____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________

b. Details of Technical Features /Parameters, if any, to rate the Technology as more

Advanced and Efficient Technology, in comparison to the one already in use:
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________

c. Any other Innovative Practice(s) to be incorporated leading to improved performance

of the power plant:
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________

E. Financial Support
E1. Nature of Financial Assistance sought for the MIP from UNDP / GEF Grant.
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________

F. CDM Consideration
F1 Whether carbon benefits envisaged from the Project : Y/ N
If yes,

F2 Whether Action Initiated for preparation of Project Concept Note (PCN)

/ Project Design Document (PDD) Y/ N
 F3 Estimated No of CERs likely to be generated annually ____________________________

G. Enclose a copy each of the following document (s), if finalized and available:

• Pre-feasibility / Feasibility /Detailed report of the proposed Project

• Power Purchase Agreement with SEB / Thrid Party
• Fuel /Biomass Supply Agreement (s)
• Copy of Statutory Clearances including SPCB and State Govt. approvals
• Appraisal Note of FI(s) and loan agreement
• Loan Disbursement Schedule
• Any other document / information relevant to the proposed project which you may
wish to add in support of the proposal
 Annexure - B

Definitions

Biomass: Biomass for the purpose of the Project would comprise agricultural
residue, agro-industrial waste / by-products, bio fuels, fuelwood obtained from
dedicated plantations especially raised for the purpose or recovered from wild
bushes / weeds; and the wood waste produced in some industrial operations.

Cogeneration: It is the process in which more than one form of energy (such as
steam and electricity) is produced in a sequential manner from a common fuel.
In case of sugar mill, the fuel source is bagasse.

Bagasse cogeneration: Cogeneration is combined heat and electricity (CHP) in

the sugar mill using bagasse.

Biomass Combustion: Biomass Materials are burned to produce steam

(Rankine Cycle)

Surplus Electricity: Quantum of installed electricity generation capacity which is

over and above the captive requirement of the mill, colony etc.