Haryana Commission Approves Tariff of ₹2.73_kWh for Procurement of 240 MW of Solar Power

The Haryana Electricity Regulatory Commission (HERC) has approved the tariff of ₹2.73 (~$0.036)/kWh discovered by the Haryana Power Purchase Center (HPPC) to procure 240 MW of solar power from Avaada Energy Private Limited for 25 years.

HPPC is a joint platform created by the state’s distribution licensees to undertake various activities, including the signing of agreements on behalf of Haryana distribution companies (DISCOMs).

The Commission directed HPPC to provide data about the amount of power purchased to supply to consumers in Haryana during the financial year 2019-20. It also asked HPPC to provide project-wise details of the 1,080 MW of solar power for which the power sale agreements (PSAs) have been signed with the Solar Power Corporation of India (SECI).

The Commission further noted that HPPC must meet the solar renewable purchase obligations (RPO) targets fixed by the Commission. As of December 2019, there was a shortfall of 1,532 million units (MUs). The Commission added that the imposition of a penalty for not achieving the solar RPO targets would further deteriorate the financial position of the DISCOMs, which are already under stress due to COVID-19 pandemic and the subsequent lockdown.

The DICOMs, in a supplementary petition, had asked the Commission to reduce the solar RPO target for FY 2020–21 to 2% from 7% and to 3% from 8% for the FY 2021-22.

HPPC earlier signed the PSAs for 1,080 MW of solar power with SECI, and approximately 1.75 GW will be available during FY 2021-22 against the requirement of 2,100 MW to meet the solar target of 8%.

HPPC had floated the tender in January 2019 to procure 300 MW of solar power through competitive bidding to meet its RPO targets. The total capacity of 300 MW was divided into two categories of 240 MW for large developers and 60 MW for small developers in Haryana. Even after four deadline extensions, the tender failed to generate enough response from the bidders, and HPPC reissued the tender in July 2019.

For category I, Avaada Energy was declared as the successful bidder for the purchase of 240 MW of power at ₹2.82  (~$0.037)/kWh, which was found to be on the higher side. Later, Avaada revised its tariff to ₹2.73 (~$0.036)/kWh.

After going through the details and the request of HPPC, the Commission approved the tariff noting that it was discovered through a competitive bidding process transparently.

According to Mercom’s India Solar Project Tracker, Haryana has a total of only 82.8 MW of solar projects in operation and 425 MW of projects in the pipeline.

Recently, the Ministry of New and Renewable Energy (MNRE) directed the state government of Haryana to honor all the allocations made to the solar power projects and solar parks and treat them as sacrosanct. The directive came on the heels of a letter submitted by Connect Solar which said that since the last two years, renewable energy developers are being asked to invest in open access solar projects in Haryana after which the new projects are being canceled with newer conditions imposed on them, leading to considerable losses for the developers.