The capacity is to be provided on a BOO (build/own/operate) basis and will be connected to the Inter-state transmission system (ISTS) to enable power transfer across regions.
States without good wind resources will be able to procure wind power from other states to meet their non-solar renewable purchase obligation (RPO).
Subsequent guideline amendments allow for non-utility bulk consumers to participate as buyers, and a waiver of inter-state transmission charges, seen as an obstacle for wind power purchase across states.
The mechanism proposed for this 1GW procurement allows planned, under construction, and stranded projects (installed assets without power purchase agreements) to make tariff bids for any capacity ranging from 50MW to 250MW.
The Solar Energy Corporation of India (SECI), which has experience in reverse bidding for solar projects, will implement the mechanism for the planned wind capacity.
India's announcement was welcomed by the industry as it would open up new markets in states that were not on the wind map.
Panama Renewables CEO, Dinesh Jagdale, said: "This may be useful for stranded or planned capacity in states like Gujarat and Andhra Pradesh where some projects have approval for ISTS connectivity.
"For other states, commissioned or under construction projects may find it unviable to construct fresh evacuation capacity to ISTS and bid competitively," he added.
Panama Renewables is independent power producer with 152MW of operational wind assets in India.