RE Capacity Growth in India Needs a Wholesale Change in Approach to Bidding in the FDRE Tenders

The report argues that India's Firm & Dispatchable Renewable Energy (FDRE) tenders require a fundamental shift in how developers bid. It suggests that the current focus on levelized costs and CAPEX efficiency is insufficient for next-generation PPAs, which transfer more risk to developers. To remain competitive and sustainable, developers must evolve into 'Developers 2.0' by strengthening power market modeling, trading functions, and risk management to handle price volatility, volume uncertainty, and cannibalization risk.

• Firm & Dispatchable Renewable Energy (FDRE) tenders represent the most advanced stage of renewable energy tender evolution in India, following round-the-clock, peak power, and hybrid wind-solar tenders. While they ideally require matching hourly demand profiles, they currently allow for a 25% annual relaxation.
• FDRE tenders are currently facing slow progress, characterized by limited developer participation and instances where hourly demand tenders have been partially awarded or cancelled. This suggests developers are struggling to effectively assess these complex tenders.
• The report critiques current discussions on FDRE PPAs for being too simplistic, specifically those suggesting that reducing the Demand Fulfilment Requirement (DFR) or focusing solely on complementary wind sites are the primary solutions. Instead, the authors argue the focus must shift to managing power market risk and optimizing battery trading.
• Developers must transition from 'Developers 1.0'—who focused on CAPEX efficiency and lowest levelized costs—to 'Developers 2.0'. This new model requires a focus on topline optimization through portfolio management and sophisticated power trading to manage the risks transferred from consumers to developers.
• Competitive pricing for next-generation PPAs requires a 25 to 30-year market price outlook to quantify three primary risks: price risk (market volatility), volume risk (weather uncertainty), and cannibalization risk (where high RE penetration drives down prices). Energy storage can mitigate these risks, particularly cannibalization, provided developers have active trading capabilities.

APA

Rodrigues, N., & Vembadi, S. (n.d.). RE Capacity Growth in India Needs a Wholesale Change in Approach to Bidding in the FDRE Tenders. Ember. https://ember-energy.org/app/uploads/2024/10/RE-Capacity-Growth-in-India-Needs-a-Wholesale-Change-in-Approach-to-Bidding-in-the-FDRE-Tenders.pdf

Chicago

Rodrigues, Neshwin, and Shiv Vembadi. RE Capacity Growth in India Needs a Wholesale Change in Approach to Bidding in the FDRE Tenders. Ember, n.d. https://ember-energy.org/app/uploads/2024/10/RE-Capacity-Growth-in-India-Needs-a-Wholesale-Change-in-Approach-to-Bidding-in-the-FDRE-Tenders.pdf.

Wikipedia

{{cite report |last1=Rodrigues |first1=Neshwin |last2=Vembadi |first2=Shiv |title=RE Capacity Growth in India Needs a Wholesale Change in Approach to Bidding in the FDRE Tenders |publisher=Ember |url=https://ember-energy.org/app/uploads/2024/10/RE-Capacity-Growth-in-India-Needs-a-Wholesale-Change-in-Approach-to-Bidding-in-the-FDRE-Tenders.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rodriguesndcapacity, author = {Rodrigues, Neshwin and Vembadi, Shiv}, title = {{RE Capacity Growth in India Needs a Wholesale Change in Approach to Bidding in the FDRE Tenders}}, institution = {Ember}, url = {https://ember-energy.org/app/uploads/2024/10/RE-Capacity-Growth-in-India-Needs-a-Wholesale-Change-in-Approach-to-Bidding-in-the-FDRE-Tenders.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }