The Appellate Tribunal for Electricity (APTEL) has set aside the Maharashtra Electricity Regulatory Commission’s (MERC) approval of Maharashtra State Electricity Distribution Company Limited’s (MSEDCL) 2,000 MW/4,000 MWh Battery Energy Storage System (BESS) tender, citing concerns over changes introduced after the bidding process had concluded.
The tribunal ruled that a condition linked to the Government of India’s Viability Gap Funding (VGF) scheme was added after financial bids had been submitted, resulting in a material alteration of the original tender framework. According to APTEL, the post-bid modification affected the integrity and fairness of the competitive bidding process.
The tender, launched in July 2025, was initially structured around a revised single-cycle-per-day battery operation model. However, following the submission and evaluation of bids, the Ministry of Power granted conditional approval requiring MSEDCL to retain the right to utilize the battery systems for up to 6,300 cycles during the project term without additional payment. Developers argued that the new requirement could significantly increase project costs and battery degradation risks.
While MERC had approved the tariff proposal, accepting MSEDCL’s position that the provision represented only a contractual right, APTEL disagreed. The tribunal observed that the additional condition created a substantial obligation that had not been reflected in the original bid documents and therefore altered the commercial assumptions on which bidders had based their proposals.
As a result, APTEL has cancelled the tender process and directed that bank guarantees and security deposits submitted by participating bidders be returned. The ruling is expected to have significant implications for future battery storage procurements, reinforcing the importance of maintaining consistency and transparency in competitive bidding processes.
