The Central Electricity Regulatory Commission (CERC) has approved a tariff of ₹2.60 (~$0.03)/kWh for a combined capacity of 600 MW from solar power projects of Solar Energy Corporation of India Limited (SECI). The Commission also approved a trading margin of ₹0.07 ($0.00084)/kWh.

Background

SECI filed a petition under Section 63 of the Electricity Act, 2003 for the adoption of tariff for the 600 MW solar power projects (Tranche-XI) connected to the Inter-State Transmission System (ISTS) and selected through the competitive bidding process.

The respondents are SAEL Industries, SAEL Solar MHP1, SAEL Solar MHP2, and Gujarat Urja Vikas Nigam (GUVNL).

The petitioner also sought approval of a trading margin of ₹0.07 (~$0.0084)/kWh as agreed by distribution companies (DISCOMs).

SECI submitted that it released a tender on March 31, 2023, including a draft power purchase agreement (PPA) and power supply agreement (PSA) for selecting 2,000 MW ISTS-connected solar power projects (Tranche-XI).

Ten bidders meeting eligibility criteria participated in the e-reverse auction, resulting in six bidders being awarded 2,000 MW, with letters of award being issued on July 28, 2023. SECI signed two separate PPAs on January 11, 2024, with SAEL solar MHP1 and SAEL solar MHP2 (project companies of the successful bidder, SAEL Industries) for 600 MW each at ₹2.60 (~$0.03)/kWh.

Additionally, a PSA was signed on December 30, 2023, with GUVNL for 600 MW. The projects are expected to be commissioned projects in 2024-25, with a competitive and beneficial price, according to SECI.

The scheduled commissioning date is June 30, 2025, and as per the regulatory framework, solar projects declaring commercial operation by this date are eligible for a 25-year waiver of ISTS charges. To avoid ISTS charges due to any delay in tariff adoption by the Commission, SECI requested a resolution of the petition.

GUVNL and SAEL Industries stated they have no objections to the Commission’s adoption of the tariff as requested.

Commission’s Analysis

The Commission noted that successful bidder selection has concluded, and tariff discovery occurred through transparent, competitive bidding, complying with Ministry of Power guidelines under Section 63 of the Act. Consequently, the Commission said it was adopting the agreed individual tariff for the 600 MW solar power project, based on executed PPAs and PSAs, remaining valid throughout their respective periods.

The Commission also endorsed a trading margin of ₹0.07($0.00084)/kWh.

The petitioner can approach the Commission for tariff adoption concerning the balance capacity once agreements for such capacity are finalized.

Recently, CERC ruled that the delay in adopting the tariff order by the Uttar Pradesh Power Corporation is a valid reason to claim an extension in the commissioning date for a wind energy project.

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