Government of Bihar , Energy Department

902 · / d8T 341ufa -ia-11 / 208(d3) 3233 [Patna, dated 10 ,07. 2015 " Sub- Bihar Policy for Promotion of Bihar New and Renewable Energy Sources 2025 Preamble The Government of Bihar ("State" ) has stepped up its climate neutral ambition with building upon the goals and policies level actions for renewable energy (RE) adoption: The country wide RE and Net-Zero targets are already set by the Indian Government along with the international commitments and pledges. The state has also undertaken a detailed study to recommend 1 low carbon development pathway and devised a phase wise strategy to achieve Net-Zero by 2070. These pledges require a faster trajectory and increased efforts for RE adoption in the state The State also aims to align with India's ambitious RE target and accelerate deployment of RE projects (from small to large-scale projects) considering the state specific scenarios 2 Legislative Framework of the Policy This policy will be referred as "Bihar Policy for Promotion of Bihar New and Renewable Energy Sources 2025" (henceforth "Policy") . Several provisions under the Electricity Act; 2003 (Act) mandates the Bihar Electricity Regulatory Commission (BERC) and the Government of Bihar to take necessary steps for promotion of RE in the state. Section 108 of the Act mandates the State to give directions to the State Commission for promotion of RE in the state including policy framework design. This policy supersedes the previous "Bihar Policy for Promotion of Bihar New and Renewable Energy Sources 2017". 3 Scope a) The scope of the policy is limited to RE and Energy Storage Projects, including but not limited to solar (photovoltaic, thermal) , hydro, wind, energy storage (battery; pumped hydro), waste to energy, green hydrogen (and green ammonia), geothermal technologies and any other renewable energy technology recognized by MNREIBREDA b) The benefits under this policy will not be applicable to the projects for which PPAs have already been signed before this policy. Operative Period This policy will come into effect from the date of issuance and will remain applicable for a period of five (5) years and/ or will remain in force till the issuance of a new policy. b) Renewable Energy Projects (REP) that are commissioned during the operative period will be eligible for the incentives declared under this policy, for a period of 25 years from the date of commissioning or for the lifespan of the energy project; whichever is earlier . If specific incentive mentioned in policy for any particulars, the same will be considered for its applicability: 5 Nodal agency a) Bihar Renewable Energy Development Agency (BREDA) will be the State Nodal Agency (SNA) for the development of all RE projects except defined RE projects in this section; Bihar State Hydroelectric Power Corporation Limited (BHPC) will be the State Nodal Agency (SNA) for the development of Hydro Power Projects and Bihar State Power Generation Company Ltd. (BSPGCL) will be the State Nodal Agency (SNA) for the development of Pumped Storage Projects in the state. Bihar State Power Generation Company Ltd. will also be Implementing Agency for the development of floating/ground mounted Solar PV Projects & Biomass power projects above 1 MW and all solar power projects along canals and dams across the state.

50 · 50 20 0 30 10 10

75 · 70 30 0 60 20 30

100 · 80 50 10 70 30 40

120 · 90 70 10 80 50 50

150 · 100 80 30 100 70 70

495 · 390 250 50 340 180 200

2 · Distributed RE(On-Grid) 2 ]Rooftop Solar 7=1.0 kW 2.2 Small Hydro Power < 25 MW Plants 2.3 Other Solar Power Plants (Floating/Ground 4 0.5 MW Mounted/canal top/bank etc.) 2.4 Solar Agriculture (Agri voltaic, Solarization of <0.5 MW Agriculture Feeders, Pumps etc. 2.5 Biomass Power Plant 0.5 MW 2.6 Waste to Energy <0.5 MW 2.7 Wind Power Plant <0.5 MW

232 · 50 20

312 · 70 30

407 · 100 65

467 · 120 65

557 · 160 70

72 · 5 5

72 · 10 10

72 · 10 10

72 · 10 10

72 · 10 15

360 · 45 50

3 · Off grid RE 3.1 Mini and micro_grids 3.2 DRE (Solar for livelihood) 3.3 Standalone Solar Pumps_

35 · 5 5

55 · 10 15

65 · 10 20

82 · 12 30

103 · 13 40

340 · 50 110

71 · 0 kW

4 · Energy Storage (MWH) 4.1 Pumped Storage_ 7=10 MWH 4.2 Grid Level Battery >=1 MWH Storage

600 · 100 500

700 · 200 500

9 · 2

9 · 3

9 · 4

10 · Useful Life of RE Projects Different RE projects have following useful life: SNo RE Project

25 · 20 25 25

11 · Incentives

11 · 4 Open Access Intra-state, open access clearance for the whole tenure of the project or 25 years whichever is earlier will be granted. In absence of any response Or intimation from the Discoms/Transcom to the RE generator within 30 days; then such application will be considered to be deemed open access. The applicable charges will be governed by BERC regulations for the same. 11.5 Stamp Duty 100% reimbursement of stamp dutylregistration fees levied on leasel sale /transfer of industrial land/shed as also those outside the jurisdiction of Bihar Industrial Area Development Authority would be available to all the new units after the unit commences the commercial production. This reimbursement of stamp duty and registration fees will be granted only for the first time and will not be applicable in subsequent stages of leaselsaleltransfer: This incentive will be available to new units only as per Indian stamp act 1899 under section 9 (1) & under section 78 of registration act 1908 in state Gazette. If any existing units setup RE Plant or goes for expansion of RE Plant, done it will be treated as new unit only for setting up additional new RE capacity plant: 11.6 Free Power and Local Area Development Fund (LADF) No free power or Local Area Development Fund (LADF) will be applicable for the development of small hydel projects within the state during operative period of this policy. 11.7 Land Conversion Charges 100% reimbursement of land conversion fees/ change in land use fees being levied for conversion of agricultural land after the unit commences the commercial production as per Bihar agriculture land (conversion for non-agricultural purpose) act 2010. 11.8 Exemption from transmission and wheeling charges Exemption of 100% on transmission and wheeling charges on RE projects developed for power consumption within the state for period of 15 years from date of commissioning of the project Grid connected RE projects with storage systems selling power within the state will attract higher exemption from transmission and wheeling charges for a period of 20 years from the date of commissioning of the project in line with Ministry of Power, Gol and will be applicable for intra State only. The details of the exemption will also be specified in the bidding document for projects developed through bidding route. The transmission and distribution losses will be applicable in line with BERC regulations as amended from time to time. 11.9 STU Charges Exemption on STU Charges will be provided to captivelopen access consumers on consumption of power from RE projects commissioned in the state during operative period of this policy in line with BERC regulations for the state_ 11.10 Banking Charges Banking of 100% of RE will be permitted for all captive and open access/ scheduled consumers during all 12 months of the year_ Banking charges and other clauses will be applicable for all RE projects commissioned in the state during operative period of this policy in line with BERC regulations as amended from time to time. 11.11 Tariff Mechanism Feed-in-Tariff (FiT) BERC will announce separate feed-in-tariff for different technology areas, in order to facilitate flourishment of defined RE technology areas in the state. State may further give directions to BERC to further devise technology as well capacity centric FiTs considering the state centric scenarios for the promotion of RE in the state.

11 · 13 Carbon Credit/Carbon Pricing The RE generating entity will retain the entire proceeds of carbon credit; if any, from an approved Clean Development Mechanism (CDM) project or mechanism under United Nations Framework Convention on Climate Change (UNFCCC) or any other mechanism developed by government of India: State will develop its own carbon credit and trading platform to promote deployment of RE projects and decarbonize its carbon footprint: 11.14 Deemed Industry Status All RE plants will be treated as *industry' under the schemes administered by the prevailing Industrial Policy of Bihar and incentives available to industrial units will be available to the RE projects. BREDA will recommend for sanctions and disbursement of the subsidy/incentives contained in Bihar Industrial

12 · Penalty for Non-compliance of Must Run Status Penalty will be applicable in case the concerned utility will not fulfill the conditions to ensure must run status of RE projects developed in the state during this policy period. The RE Projects installed in the

13 · Mandatory use of RE sources

14 · Convergence of Schemes State will devise necessary provisions for the convergence of different government schemes for integration and coordination of various programs, funds, and expertise across different departments and agencies for the promotion of RE project development in the state. The aim of this initiative is to optimize public investments and enhance their impact on the people of the state.

15 · Resource (land/CanaVreservoir[River/Rooftops etc) It is the responsibility of the project developer to acquire the required resource for setting Up the project: However, in case of resource owned by state government, allotment will be done as per the prevailing government policy.

16 · Environmental Clearance

17 · Building RE Based Manufacturing Capacity The state government will focus on creating adequate ecosystem for the promotion of RE based equipment manufacturing facilities. For solar; the focus will not be confined to solar PV module assembling; manufacturing facility to strengthen the solar value chain starting from polysilicon to solar modules will be promoted. Manufacturing of Balance of System as well as assembling of equipment for applications like mini grids, solar streetlights, solar irrigation pumps, etc. will also be promoted in the state. Promotion of manufacturing capacity will be done in collaboration with other departments by enabling provisions for establishing special economic zones in the states. The state government will take following actions in this regard. Priority allotment of Government land in solar parks/other RE parks on a long-term lease basis. b. Electricity duty will be waived for the new manufacturing facilities for RE and other related components for a period of 5 years: C. 100% exemption on stamp duty: d. Reimbursement of SGST based incentive to all RE equipment manufacturers. e. 100% reimbursement of custom duty paid on input required for manufacturing solar RE equipment battery storage for a period of 5 years f Any other incentives provided in the prevailing Bihar Industrial Policy and any amendments from time to time_

18 · Research and Development (R&D) and Stakeholders Engagement for Innovation BREDA will collaborate with multilateral Agencies at locall Nationall International levels for advancing RE research and development in the State for technical and financial support b_ BREDA will work with concerned departments to support pilot demonstration for carrying out end- of-life waste management BREDA will undertake research through identification of different focus areas for further Policy Interventions. The focus areas will be decided by BREDA in consultation with the Bihar R & D and Innovation Committee for every financial year. d_ Minimum 5 % of the total budget for financial year will be dedicated for Research and Development (R&D) This includes piloting & project under focus area, trainings for internal human resources of the state and other support for commercialization of RE project in the state. Dedicated R&D Centre for RE will be made operational initially under BREDA, the same may be developed as an independent entity of the state for performing the above roles. f. Bihar R & D and Innovation Committee will take decision for the development of a separate entity like Bihar Energy Research and Management Institute for performing all works related to R&D; Innovation; Trainings etc. g. Dedicated human resource(manpowerlexperts) will be engaged under BREDA for performing all necessary work like engaging with statelcentral government/ expert organization/ any other entity for facilitation the project development on the focus area. h BREDA will collaborate with multilateral Agencies at locall National/ International levels for bringing innovations considering the state centric scenarios 1_ BREDA will organize national/stateldistrict level consultation with workshops/challenges to bring innovation to solve ground level issues in the state through renewable energy_ Minimum two number of such workshop/challenges will be organized in every financial year. j: A committee will be formed namely Bihar R & D and Innovation Committee for organizing the workshoplchallenge will be as below: 1_ Director BREDA Chairperson_ ii, Managing Director BHPC or_their_representative Member & Convener iii: Managing Director NBPDCL or their Representative Member iv Managing Director SBPDCL or their Representative_ Member V_ Managing Director BSPTCL or their Representative_ Member vi: Managing Director_ BSPGCL or their Representative_ Member vii: Director IT Patna or their_ Representative_ Member viii. Director NIT Patna or_their Representative Member ix President Bihar Industries Association or their Representative_ Member X Renewable Energy Expert (Nominated by BREDA) Member xi. Renewable Energy Project Developer Open Representation

19 · Payment Security Mechanism (PSM) The Nodal Agency in consultation with the departments will set up payment security mechanism for the sale of electricity to Government Departments and Discoms in line with MoP guidelines. b The Nodal Agency may explore option of creating the PSM by means of creating ESCROW accounts of the department and the developer and the first right of way with the developer for collection of undisputed dues which the department may have failed to pay in time. C. The Nodal Agency may also create the PSM with Post-dated cheques (PDC) or Bank Guarantees from Government Department equal to at least Six Months Energy Bill. d_ The Nodal Agency will also provide assistance to the developers by engaging with the government department and arranging for documents required for availing finance. e. The Nodal Agency will facilitate the renewable plant developers to avail the subsidy available from Central andlor State Government_

20 · Data monitoring Availability of data plays a key role for project developers and system installers while making investment decisions. State will set up new precedents in data transparency and will endeavor to have the performance data of projects in public domain through its web portal and through mobile application. AIl new projects to be set up in Bihar will be mandated to record and provide real time data pertaining to plant performance, which will be collated and presented on the web portal. Once implemented for grid connected projects; the data monitoring plan will be extended to off-grid and decentralized projects as well The data such collected will help in identifying the key factors affecting the plant performance and then work on ways to improve operational efficiencies of projects. The state government will also set up 10 weather stations with support from NIWE at locations suitable for setting up of different RE projects, including the proposed RE parks RE resource data is required by the project developers to estimate generation from project; hence, to calculate the financial returns This will provide the project developers with the information that is bankable and will reduce the possibility of project failure at the stage of financial closure_

21 · Transmission and Distribution Infrastructure

22 · Power Sale Mechanism 22.1 RE Power projects for Sale of Power to Discom: The competitive bidding route will be followed for procurement of power by Discoms from different RE projects considering the threshold capacity for the concerned technology, as approved by the State/Government of India; from time to time Moreover, this RE Policy recognizes threshold capacity for all RE projects to be 5 MW, the same may be revised by BERC from time to time in line with central government orders. Procurement of power; from grid connected RE Projects, having individual size of 5 MW and above, will be done through competitive bidding: Below the threshold capacity, BERC will devise separate technology centric feed in tariff (FiT) for purchase of power from different RE generating units. FiT will remain firm for all capacities below the threshold capacity, no competitive bidding will be performed for the same In order to facilitate flourishment of different technology areas of RE in the state and capacity enhancement constraints, BERC may be asked to devise technology as well capacity centric FiTs considering the state centric scenarios.

22 · 2 RE Power projects under Renewable Energy Certificate (REC) Mechanism The State will promote the development of RE power plants through purchase of power under the REC mechanism in accordance with the administrative procedure regarding registration and accreditation, as decided by the state or Central Electricity Regulatory Commission (CERC) and its amendment time to time. BREDA being the state agency will extend its support for the accreditation of the RE power plant and recommending its registration with the Central Agency in a time bound manner. In carrying out its role, BREDA will be guided by any directions given to it by BERC for the implementation of the framework; from time to time. BREDA in consultation of state Discoms will formulate guidelines for the development of RE projects under REC Mechanism.

22 · 3 Renewable Power Plants for Sale of Electricity to any entity other than the Discom (Third-Party Sale): The State will promote development of RE power plants for sale of electricity to any entity other than the Discoms The sale of electricity by the owner of RE power plants to any other entity will be considered as Third-Party Sale. RE Power Projects may be installed for Third-Party Sale without any capacity restrictions Discoms will provide open access approval in time bound manner to promote third party sale of power:

23 · Bihar Akshay Urja Kendra BREDA will open dedicated Bihar Akshay Urja Kendra in every district with the following objectives and responsibilities:

24 · 2 Application Charges BREDA will charge following processing fee (non-refundable):

25 · Bihar Renewable Energy Development Fund (BRDF) State will create Bihar Renewable Energy Development Fund (BRDF), this fund will be utilized for facilitating the state to meet the objectives defined in this policy. BREDA will organize committee members meeting within 3 months from the date of notification of this policy to discuss on the structure for management of BRDF and department wise responsibility for fund management. The detailed attributes of BRDF are as below.

25 · 1 Objectives a. Providing all the financial incentives as envisaged in this policy for development and deployment of RE Projects in the state _ b Focus on Research and Development relating to different RE technologies. C. Supporting startups in the field of RE and its innovative applications in the state_ d_ Capacity building support for creating a conducive environment for RE acceleration in the state.

25 · 2 Fund Creation Necessary work for fund creation and co-ordination with the concerned department will be carried out by BREDA and other Nodal Agency nominated by Energy Department: A Fund Management Unit will be created within BREDA for all necessary work related to fund creation, this unit will constitute one official from BHPC and BSPGCL. BRDF will be created through the following modes:

26 · 3 State Level Empowered Committee (SLEC) 1. To resolve key bottlenecks in implementation of this policy and resolve any other Inter departmental issues that may arise from time to time, High level committee will be constituted under the chairmanship of the Chief Secretary of the State. b For approval of projects equal to 50 MW and above at a single location or to undertake any strategic decision other than approval related to RE targets of the state, SLEC will be constituted under the chairmanship of the Chief Secretary of the State. The SLEC will meet quarterly to monitor the progress and take decisions in case of any ambiguity, dispute, difference, or issue in implementation of the policy. BREDA will submit the progress report of all RE projects in the state to the SLEC on half yearly basis. d_ The committee will constitute of the following members: 0) Chief Secretary Government of Bihar Chairperson ii) Secretary /Principal Secretary, Department of Energy Member & Convener iii) Secretary /Principal Secretary, Department of Planning and Member DevelopmentGoB iv) Secretary/ Principal Secretary, Department of Revenue and Member Land ReformsGoB v) Secretary/ Principal Secretary; Department of Environment; Member Forest & Climate Change, GoB vi) Secretary/ Principal Secretary, Department of Industries, GoB Member vii) Secretary, Department of Water Resource, GoB Member viii) Secretary /Principal Secretary, Department of Finance, GoB Member ix) President; BIA Member

27 · Review of Policy State Government may undertake review of this policy on yearly basis under the chairmanship of Chief Secretary, Government of Bihar after period of one year Or as and when need arises in view of any technological breakthrough or to remove any inconsistency with Electricity Act 2003, rules and regulations made there under or under any Government of India policy: The policy review committee will comprise of all the relevant departments of this policy. Retrospective amendments to the incentives available under this policy will be avoided for ensuring investor confidence in the State and in the sector:

28 · Relevant Departments AIl concerned departments and organizations will issue follow up notifications within two months to give effect to the provisions ofthis policy. The concerned departments are listed below: a. Department of Agriculture, b. Department of Animal & Fisheries Resource Department C. Department of Co-operative

29 · Power to Remove Difficulties If there is any ambiguity, dispute, difference, or issue arises in regard to interpretation/ implementation of this Policy, State Level Empowered Committee may take decision in such matters, not inconsistent with the provisions of the Policy, as may appear to be necessary and expedient for removing the difficulties either on its own or after hearing those parties who have represented for change in any provision: 30 Implementation Guidelines/Framework BREDA will issue implantation guidelines or framework in consultation with the concerned department for different technology area considering the state centric parameters and applicability: These guidelines or framework will clearly describe the technology area, role, and responsibility of all the stakeholders' involved, targeted capacity and timelines for achieving the same. Following guidelines or framework will be formulated for achieving the objectives of the policy: