The Maharashtra Electricity Regulatory Commission  (MERC) has approved the tariff for Maharashtra Electricity Distribution Company’s (MSEDCL) procurement of 5,008 MW of solar power from projects under the Mukhyamantri Saur Krushi Vahini Yojana (MSKVY) – 2.0.

The approved tariff ranges between ₹2.82 (~$0.032) and ₹3.10 (~$0.036)/kWh.

Background

The petitioner, MSEDCL, followed a cluster-wise and individual substation-wise tendering approach. The Commission approved bid documents and deviations for the solarization of agricultural feeders of 7,000 MW in 2023.

Subsequently, MSEDCL filed a petition seeking approval for deviations regarding the individual substation-based and cluster tenders in February 2024, which the Commission approved in March 2024.

The Commission had also allowed MSEDCL to procure additional power up to 2,000 MW under subsequent bidding rounds under MSKVY 2.0.

In September 2024, the Commission approved the purchase of 5,991 MW of solar power under MSKVY 2.0 through competitive bidding. The petitioner awarded a capacity of 4,988 MW through an open and 20 MW through a cluster tender.

It proposed a tariff between ₹2.82 (~$0.032)/kWh and ₹3.10 (~$0.036)/kWh for procuring 5,008 MW of solar power after completing the bid evaluation process.

The petitioner argued that approving the tariff could help provide daytime electricity to agricultural consumers and reduce overall power procurement costs. It also submitted that approving the power purchase could help it meet its renewable purchase obligation (RPO) requirements.

Commission’s Analysis

The Commission noted that the procurement proposed under the MSKVY 2.0 program is typical for the solarization of agricultural feeders. It observed that the petitioner’s tendering process was transparent and adhered to central government guidelines.

The Commission also held that the discovered tariffs conformed to prevailing market rates. It acknowledged that approving the power purchase would help MSEDCL adhere to its RPO requirements and meet the agricultural consumers’ daytime electricity needs.

MERC also observed that the discovered tariff fell in the ‘₹2.90 (~$0.045)/kWh to 3.10(~$0.036)/kWh’ range with a weighted average tariff of ₹3.08/kWh (~$0.035). This range and average were determined as a yardstick for tariff ranges in a 2024 decision.

The Commission approved the discovered tariff of ₹2.82 (~$0.032)/kWh and ₹3.10 (~$0.036)/kWh and approved MSEDCL’s power purchase.

MERC approved Maharashtra State Electricity Distribution Company’s (MSEDCL) proposed tariff of ₹3.60 (~$0.042)/kWh to procure 13 MW of wind-solar hybrid power for 25 years.

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