Training on the Design, Management and Operation of a Power Trading Entity Tender

Procurement Summary

Country : USA

Summary : Training on the Design, Management and Operation of a Power Trading Entity

Deadline : 02 Apr 2021

Other Information

Notice Type : Tender

TOT Ref.No.: 50710141

Document Ref. No. :

Competition : ICB

Financier : United States Agency for International Development (USAID)

Purchaser Ownership : -

Tender Value : Refer Document

Purchaser's Detail

Purchaser : UNITED STATES ENERGY ASSOCIATION
Attn: Ms. Sarah Blanford, Deputy Program Director, Energy Utility Partnership Program 1300 Pennsylvania Avenue, NW, Suite 550, Mailbox 142 Washington, DC, 20004 Tel: (202) 312-1230
USA
Email :sblanford@usea.org
URL :https://usea.org/

Tender Details

Request for proposals are invited for Training on the Design, Management and Operation of a Power Trading Entity.

United States Energy Association

South Asia Regional Initiative for Energy Integration (SARI/EI)

Request for Proposal - Capacity Building Training Program

February 2021

REQUEST FOR PROPOSAL - Training on the Design, Management and Operation of a Power Trading Entity

Closing date of RFP: April 2, 2021

Implementing Agency: United States Energy Association

Funding Agency: United States Agency for International Development

Maximum Award Amount: $25, 000 USD

Training recipients: Training focused on South Asia

Location of training: Remote via video conferencing

Through funding provided to the U.S. Energy Association-s (USEA) cooperative agreement with the U.S. Agency for International Development (USAID), USEA is organizing a training program on electricity trading tailored to South Asia. The training is intended to provide the participants with institutional and human capacity building in the design, management and operation of a power trading entity.

The training will be conducted as part of USAID-s South Asia Regional Initiative for Energy Integration (SARI/EI) program.

Proposals are due by 17:00 hours EST of the closing date. Please forward your proposal in soft copy with a read receipt to Ms. Sarah Blanford, Deputy Program Director, Energy Utility Partnership Program, at sblanford@usea.org.

As this is a USAID-funded program, the RFP follows USAID Procurement Regulations and Laws. All bidder details will be kept confidential.

I. INTRODUCTION

The U.S. Energy Association (USEA), headquartered in Washington, DC, is an association of public and private energyrelated organizations, corporations, and government agencies.

Through a cooperative agreement with the United States Agency for International Development (USAID Bureau for Development, Democracy, and Innovation (DDI), the United States Energy Association implements an Energy Utility Partnership Program (EUPP) available to all USAID-assisted countries and USAID Missions. EUPP assists developing countries to increase environmentally sustainable energy production and use and improve the operational efficiency and increased financial viability of their utilities and related institutions. The goal of the EUPP is to increase access in USAID-assisted countries to environmentally sound energy services


Under the EUPP mechanism, USEA implements activities for the USAID South Asia Regional Initiative for Energy
Integration (SARI/EI) program. USAID first launched the South Asia Regional Initiative for Energy (SARI/E) program
with USEA in 2000. The first three phases of the program focused on cross-border energy trade (CBET), energy
market formation and regional clean energy development. The current phase, entitled the South Asia Regional
Initiative for Energy Integration (SARI/EI), covers the eight countries of Afghanistan, Bangladesh, Bhutan, India, the
Maldives, Nepal, Pakistan and Sri Lanka, and aims to further the earlier objectives of advancing regional energy
integration and increasing CBET. Since 2015, USEA-s SARI/EI program has conducted a number of capacity-building
trainings focused on designing, managing, and operating a power trading entity. This RFP is intended to serve the
continued need for capacity building in this area.
II. SUMMARY
This “Power Trading Training” will provide 25 participants with institutional and human capacity-building in the
design, management, and operation of a power trading entity. The training will stress the development of skills and
knowledge in the functional operations of power trading. The anticipated attendance will be comprised of 7
delegates each from Bangladesh, Bhutan, and Nepal; and 4 delegates from Sri Lanka - 25 total.
The contractor must have expert knowledge of the design and development of energy trade, markets and the
political, economic and technical issues associated with South Asian regional energy trade. The contractor is
expected to have prior regional, relevant working experience providing and a solid understanding of the South Asian
regional power sector and its market capabilities as well as other power markets in the region.
The purpose of this RFP is to solicit proposals, conduct a fair and extensive evaluation, and select the organization or
consortium deemed most suitable to conduct the training.
Read more: www.sari-energy.org.
III. BACKGROUND
South Asia is the fastest growing region in the world, with an average annual growth rate of 7% as measured by GDP
per capita. Yet despite this impressive macroeconomic growth, the energy sector in the region has not been able to
keep pace and continues to experience problems of supply shortage and poor quality of service. South Asia-s energy
security dilemma is one of the single energy development challenges of the 21st century critical to the economic future
of almost 1.5 billion people. Given this dilemma, the only long-term solution is the sustained increase in regional
energy cooperation among the South Asian countries. USAID-s South Asia Regional Initiative for Energy Integration
(SARI/IE) program has been advocating energy cooperation in South Asia since 2000. Now the program has
transitioned to the next phase of advancing regional energy integration and cross-border energy trade (CBET) in the
eight South Asian countries. The program addresses policy, legal, and regulatory issues related to energy in the region;
promotes transmission interconnections and works towards establishing a regional market exchange for electricity.
Over the past several decades South Asia has witnessed the steady growth of CBET between India and Bhutan and,
more recently, between India and its other eastern neighbors, Nepal and Bangladesh. However, despite the
tremendous benefits of regional energy trade and co-operation, CBET has thus far been limited in scope and influence
upon energy trade in South Asia. There is a clear recognition that South Asia-s energy sector has not been able to keep
pace with the needs of the region, including a growing customer base, and it continues to experience chronic problems
of shortage of supply and poor quality of service. The majority of South Asian countries struggle to connect their
remote and rural customer base to the electricity grid, and CBET could expand the reach of electricity into these unlit
regions.
Currently in South Asia, India, Bangladesh, Bhutan and Nepal have established transmission links through which
electricity is being traded. Opportunities for cross border electricity trade in the region have amplified particularly
RFP - Training on the Design, Management and Operation of a Power Trading Entity Page 3
now that energy security has become a political priority for all the country governments. The Government of India-s
revised guidelines on Cross-Border Power Trade paved way for tri-lateral power trade and also made Indian power
exchanges more accessible to the regional participants. These developments have mobilized stakeholders for
regional and sub-regional projects in the areas of power generation, transmission and power trade. The gravitas for
CBET in South Asia has been further supported by the creation of the “SAARC Council of Experts and Energy
Regulators (Electricity)”. India and Nepal are in the process of expanding their cross-border transmission lines to
further establish the two country-s energy trade, which has been beneficial for both countries in developing
transmission interconnections and grid connectivity.
For additional information regarding the region-s cross-border energy trade: https://sari-energy.org/programactivities/cross-border-electricity-trade/
IV. SCOPE OF WORK
Training Purpose
The training will provide the participants with the background for developing the institutional and human capacity to
participate in, as well as design, manage, and operate a power trading entity.
Training Objectives
Classroom-style lectures are to be delivered by highly experienced instructors, supplemented by hands-on exercises
that emphasize development of skills and knowledge in the functional operations of power trading. Emphasis should
be on providing hands-on activities including role play, class exercise, review of PPAs, PSAs, demonstration of bid
submission to clearance on power trading software.
Training will supply participants with proficiency in the following topics:
• The evolution of power trading as a separate entity in the power sector, the various roles played by power
traders, basic guidelines for power trading, propriety trading vs. portfolio optimization, arbitrage
• Market participants & their role: brokers, traders, dealers, market makers, liquidity providers, marketers,
wholesale merchants, investment banks, traders, power exchange, and grid system operator
• Setting up a power trading entity:
o Legal framework for operation of a power trading entity
o Procedures and terms and conditions for granting of trading license
o Statutory compliance for traders
o Human resources and infrastructure requirements for setting up of a power trading entity
o Net worth and working capital considerations and requirements
• Short term, long/medium term power purchase and sales
• Power purchase/sales agreements: major contractual, financial and commercial provisions and their
significance
• Scheduling, billing, energy accounting, settlement, and bidding on power exchanges and over-the-counter
trade
• Tariff models for competitive bidding processes, review of the existing tariff models
• Identifying and mitigating risks
• Gap analysis of existing and required policies
• Case studies within the region
• Guarantees (such as sovereign guarantee from GOP) or no guarantees
Program Requirements:
The lessons are to be tailored to the status of South Asia-s power sector. The cont

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