The Bihar Electricity Regulatory Commission (BERC) has approved a petition filed by the Bihar State Power Holding Company (BSPHCL) to procure 300 MW of wind power at a tariff of ₹3.97 (~$0.046)/kWh along with a trading margin of ₹0.07 (~$0.00082)/kWh.

The Commission also approved the draft power sale agreement (PSA) to be executed between Solar Energy Corporation of India (SECI) and BSPHCL on behalf of the two state distribution companies, North Bihar Power Distribution Company (NBPDCL) and South Bihar Power Distribution Company (SBPDCL).

Background

The petitioner, BSPHCL, sought regulatory approval to procure wind power on a long-term basis from SECI.

SECI had issued the tender with draft power purchase agreements (PPAs) and PSAs to procure wind power through a tariff-based competitive bidding process.

After the e-reverse auction, Torrent Green Energy emerged as the winner. Detailed capacity allocation and tariff information were submitted to support the petition. Two projects from Torrent Green Energy, with capacities of 175 MW and 125 MW, respectively, are expected to generate 838.91 million units (MU) annually, with declared capacity utilization factors of 33% and 30.36%, respectively. This generation is expected to contribute significantly towards BSPHCL’s Wind purchase obligation.

SECI offered the 300 MW of wind power to BSPHCL at a tariff of ₹3.97 (~$0.046)/kWh, along with a trading margin of ₹0.07 (~$0.00082)/kWh.

The petitioner highlighted that only 550 MW out of a previously available 1,050 MW of wind power had been commissioned so far. The remaining 500 MW of capacity was terminated by SECI, resulting in a shortfall in wind energy procurement. This has negatively impacted BSPHCL’s compliance with its renewable purchase obligation (RPO) targets.

The new procurement of 300 MW is intended to offset that shortfall. BSPHCL had earlier received approval for the procurement of 100 MW of wind power through SECI, and the current proposal is a continuation of efforts to bridge the remaining deficit.

BSPHCL noted that this procurement would benefit from waivers on inter-state transmission system (ISTS) losses, depending on the commissioning timeline. Wind projects commissioned by June 30, 2025, would be eligible for a full waiver, while those commissioned later would receive partial waivers over 25 years, depending on the commissioning year.

SECI stated that the wind projects under Tranche XVIII are expected to be commissioned within 24 months from the date of signing the PPA. Following SECI’s offer, BSPHCL issued an in-principle consent to procure 300 MW of wind power.

Commission’s Analysis

The Commission reviewed the long-term RPO trajectory for Bihar. BSPHCL’s submissions revealed a projected shortfall of 1,313 MU in wind power obligations for the financial year 2026-27, 1,126 MU in 2027-28, and as much as 2,256 MU by 2029-30. Given this anticipated shortfall and the previous termination of 500 MW worth of PSAs, the Commission agreed that the procurement of 300 MW was justified and necessary to help meet these renewable energy obligations.

The Commission also found the rate of ₹3.97 (~$0.046)/kWh to be reasonable as it was consistent with recent tariffs discovered in similar wind energy bids. The trading margin of ₹0.07 ₹0.07 (~$0.00082)/kWh was also in line with Ministry guidelines and was therefore approved.

The Commission noted that full transmission charge waivers are only applicable to wind projects commissioned on or before June 30, 2025. Since the projects under this procurement are expected to be commissioned within 24 months of signing the PPA, it is unlikely they will meet this deadline.

As a result, they may not qualify for the full waiver but could still receive partial waivers based on their commissioning date. Additionally, the Commission clarified that waiver of ISTS losses is only applicable for projects whose bidding process concluded before January 15, 2021. Since the current bidding was conducted under guidelines issued in July 2023, the projects will not be eligible for ISTS loss waivers.

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