The Gujarat Electricity Regulatory Commission (GERC) has approved the power purchase agreement (PPA) between Jubilant Infrastructure (JIL), a wholly owned subsidiary of Jubilant Ingrevia, and O2 Renewable Energy III (O2 Renewable), a subsidiary of O2 Power, for procuring 9 MW of wind-solar hybrid power.

The power will be purchased at a tariff of ₹4.13 (~$0.04)/kWh.

Background

The petitioner, JIL, was designated as a special economic zone (SEZ) developer by the Ministry of Commerce and Industry, enabling the development, operations, and maintenance of utility services, including electricity distribution within the SEZ.

The petitioner was granted a distribution license by GERC in 2012 to distribute energy within the SEZ. JIL, however, did not actively operate as a distribution licensee at the time because of low energy load demand, variability in load, and being new to the distribution business.

JIL aimed to start operating after a sufficient increase in load demand and the full development of a distribution network in the SEZ.

The petitioner received GERC approval to commence operations as a distribution licensee in August 2023 and issued a request for proposal (RfP) to procure 9 MW of renewable energy.

Only O2 Renewable responded with a bid, which was evaluated and found to comply with the RfP requirements.

The discovered tariff was ₹4.13 (~$0.04)/kWh, and O2 Renewable proposed a 70% capacity utilization factor (CUF).

The petitioner sought approvals from GERC for the PPA and for some deviations from the original approval, including an increased CUF, handling excess energy beyond contracted capacity, delay in commissioning, change in law, and inclusion of green attributes benefits of renewable energy procurement.

Commission’s Analysis

The Commission observed that the petitioner discovered the tariff through a transparent bidding process by issuing an RfP, and O2 Renewable’s bid was compliant with its requirements.

The Commission acknowledged that the tariff of ₹4.13 (~$0.04)/kWh was higher than other discovered tariffs in the state, but the quantum of power procurement in the other tenders was higher.

It also noted that the 70% CUF proposed by O2 Renewable would reduce transmission costs and mitigate price volatility risks for SEZ-based customers.

The commission approved the petition, allowing the petitioner to execute the PPA with O2 Renewable to procure 9 MW of hybrid renewable energy at the discovered tariff.

In November 2024, GERC approved tariffs for 101 solar power projects of Paschim Gujarat Vij Company with a total capacity of 259 MW under Component C of the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan  program.

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