Maharashtra DISCOM Does Not Want to be Penalized for Non-Compliance of RPO’s

The Maharashtra State Electricity Distribution Company Limited (MSEDCL) has filed a petition before the Maharashtra Electricity Regulatory Commission (MERC) against its new Renewable Purchase Obligations (RPO) regulation.

In the petition, the DISCOM has made several requests to the commission –

  • To not levy penalty on non-compliance of standalone annual targets and cumulative targets of RPO until 2022-23
  • To allow MSEDCL to revise the ceiling tariff for solar tenders with capacities between 2-10 MW from ₹3.15 (~$0.04)/kWh to ₹3.30 (~$0.05)/kWh
  • To allow MSEDCL to purchase bagasse power with expired energy purchase agreements at the average power purchase cost (APPC) price or a tariff cap of ₹4 (~$0.06)/kWh
  • To allow MSEDCL to issue tenders with a combination of projects with expired EPAs and new capacities to encourage better participation
  • Allow MSEDCL to increase the ceiling tariffs for upcoming wind tenders

The MERC has said that the hearing of the case will be held on February 18, 2020.

In October 2019, MERC issued a draft policy announcing its RPO from 2020 to 2025. The solar RPO targets mentioned in the policy draft started at 4.5%, going up to 13.5% over the next five years. Following the draft announcement, MSEDCL suggested revisions stating that the solar RPO target of 13.5% by 2024-25 was quite stiff and that despite efforts, it would not be able to achieve them. A total solar capacity of 12,500 MW would be required by 2024-25 to achieve the target while its current contracted solar capacity stands at 4,200 MW.


In December 2019, the state DISCOM issued a tender to procure 200 MW of wind power on a long-term basis from intra-state wind power projects. The power procured from the wind projects would help MSEDCL fulfill its non-solar renewable purchase obligation.

Previously, Mercom reported that MSEDCL had filed a petition with the MERC seeking its approval to procure power from wind projects whose energy purchase agreements have expired to fulfill its RPO.

RPO is the single most important policy driving renewable energy installations in India toward achieving the aggressive goal of installing 175 GW by 2022, with solar comprising 100 GW of this portfolio. Despite the ambitious targets, RPO compliance has not been up to the mark.

The MNRE has created a compliance cell for RPOs. The cell will coordinate with states, the central electricity regulatory commission (CERC), and state electricity regulatory commissions (SERCs) to ensure RPO compliance.