Problem during deployment of BDC Model

First thing to check is Feature1.Template.xml. Chances are it lacks SiteUrl property. Here is example of correct xml code:

<?xml version="1.0" encoding="utf-8" ?>
<Feature xmlns="http://schemas.microsoft.com/sharepoint/">
  <Properties>
    <Property Key='SiteUrl' Value='http://...'/>
  </Properties>
</Feature>