The Central Electricity Regulatory Commission (CERC) has allowed NTPC to adopt a tariff within the range of ₹2.60 (~$0.031) – ₹2.65 ($0.0316)/kWh for 1,500 MW solar projects connected to the inter-state transmission system (ISTS).

The Commission said trading margins will be determined per the power sale agreement (PSA) between NTPC and distribution licensees.

Background

On July 25, 2023, NTPC issued a request for selection to establish 1,500 MW ISTS-connected solar power projects under tariff-based competitive bidding.

NTPC received six bids for an aggregate capacity of 2250 MW.

As per the eligibility criteria, five bidders were shortlisted for the e-reverse auction. Based on the e-reverse auction conducted on January 4, 2024, NTPC arrived at the final tariff and issued the letter of award (LoA) for an aggregate capacity of 1,500 MW on January 24, 2024, to Anboto Solar (300 MW), Apraava Energy (300 MW), Avaada Energy (500 MW) and ReNew Solar Power (400 MW). The LoA was issued to Anboto Solar for the final tariff ranging between ₹2.60 (~$0.031) – ₹2.65 ($0.0316)/kWh.

NTPC also told the Commission that it executed a PSA with Maharashtra State Electricity Distribution Company on August 13, 2024, and a PPA was signed with Anboto Solar for 330 MW.

It also said discussions were on state utilities/DISCOMs regarding the sale of the balance capacity.

In the April 4, 2024 hearing, NTPC said that, per the solar guidelines, it is required to approach the Commission to adopt the tariff through an e-reverse auction within 15 days of discovering it.

Commission’s Analysis

The Commission said MSEDCL has agreed to a trading margin of ₹0.07(~$0.0008)/kWh as decided in the PSA. For the balance capacity, the trading margin will be as per the provisions of the PSAs to be entered into between NTPC and the distribution licensees.

However, in case of failure by the NTPC to provide an escrow arrangement or irrevocable, unconditional, and revolving letter of credit to the solar generators, the trading margin will be limited to ₹0.02 (~$0.0002)/kWh as specified in the Trading License Regulations.

In August, the CERC adopted tariffs discovered through competitive bidding for 2.37 GW of ISTS-connected renewable energy projects with energy storage systems. The order came in response to a petition filed by SJVN seeking tariff adoption under Section 63 of the Electricity Act, 2003.

The Commission recently issued the Central Electricity Regulatory Commission (Deviation Settlement Mechanism and Related Matters) Regulations, 2024.