The Central Electricity Regulatory Commission (CERC) has approved annual transmission charges of ₹23.92 billion (~$249.86 million) for the interstate transmission system (ISTS) project to evacuate 8 GW of power from the renewable energy zone in Khavda, Gujarat, under Phase-V: Part C.

The tariff was determined through a bidding process, in which Adani Energy Solutions emerged as the successful bidder.

The sharing of these charges by designated ISTS customers will be governed by the CERC Sharing of Inter-State Transmission Charges and Losses Regulations, 2020.

Background

Adani Energy Solutions and KPS III HVDC Transmission filed a petition seeking the adoption of transmission charges for the Khavda project.

The petitioners also sought approval for sharing and recovery of transmission charges under the applicable CERC sharing regulations.

The Ministry of Power had notified PFC Consulting as the Bid Process Coordinator (BPC) for the selection of the transmission service provider.

The tender was floated in July 2024. Adani Energy Solutions emerged as the successful bidder in the e-reverse auction.

Commission’s Analysis

The Commission considered the Bid Evaluation Committee’s certificate confirming that the bid process had been conducted in accordance with the bidding guidelines. The committee also certified that Adani Energy Solutions emerged as the successful bidder with the lowest quoted transmission charges of ₹23.92 billion (~$249.86 million) per annum.

The regulator noted that the quoted tariff was approximately 12% higher than the levelized tariff calculated in accordance with CERC norms.

However, it also noted the evaluation committee’s observation that the project uses Voltage Source Converter technology, making it the first project in India developed through a competitive bidding process using this technology, and that the higher quoted price could be partly attributable to the risk associated with adopting this technology.

CERC adopted the annual transmission charges of ₹23.92 billion (~$249.86 million), subject to the grant of a transmission license to KPS III HVDC Transmission, and noted that the sharing of transmission charges would be governed by CERC’s sharing regulations.

Recently, CERC held that renewable energy generators are liable to pay bilateral transmission charges for the associated transmission system until their projects achieve commercial operation.

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