The Central Electricity Regulatory Commission (CERC) has approved tariffs ranging between ₹4.64 ($0.0532)/kWh and ₹5.25 ($0.0602)/kWh for 1,530 MW of renewable energy procured by NTPC through a competitive bidding process.

CERC also approved a trading margin of ₹0.07 (~$0.0008)/kWh, subject to compliance with the financial security provisions. The tariffs are a part of NTPC’s bid to procure 3,000 MW of renewable energy from grid-connected power projects.

Background

The petitioner, NTPC, filed for the tariff adoption after conducting an international competitive bidding process for 3,000 MW of firm and dispatchable renewable energy. The process attracted ten bidders, with a total techno-commercially qualified bid capacity of 1,980 MW.

After a reverse auction, NTPC awarded contracts for 1,584 MW to ten bidders. However, the final accepted capacity was 1,530 MW, as the last bidder, ACME, declined the remaining 54 MW.

Other successful bidders included ABC CleanTech, Juniper Green Energy, BN Dispatchable-1, Hero Solar Energy, ReNew Solar Power, Serentica Renewables, and Tata Power Renewable Energy. The projects’ power purchase and sale agreements will be signed for 25 years.

NTPC contended that the discovered tariffs were competitive and in the best interest of both procurers and consumers. It also submitted a certificate from the bid evaluation committee, confirming that the bidding process was conducted transparently and complied with government guidelines.

Commission’s Analysis

CERC confirmed that NTPC had followed a transparent and competitive bidding method per government guidelines. It acknowledged that the selection of successful bidders and the tariff discovery adhered to the provisions outlined under Section 63 of the Electricity Act.

The Commission allowed the tariff adoption despite the pending PPA and PSA executions but made it conditional upon NTPC finalizing these agreements with the distribution companies. It directed NTPC to submit copies of the executed agreements once completed.

CERC approved the ₹0.07 (~$0.0008)/kWh trading margin proposed by NTPC. However, it imposed a cap of ₹0.02 (~$0.00023)/kWh in cases where NTPC failed to provide financial security measures such as an escrow arrangement or an irrevocable, unconditional letter of credit. The cap aligns with Regulation 8 of CERC’s Trading License Regulations, which governs trading margins under long-term contracts.

In November 2024, CERC adopted tariffs for 1,000 MW of interstate transmission system-connected wind-solar hybrid power projects awarded by NTPC under Tranche V.

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