The Maharashtra Electricity Regulatory Commission (MERC)  has approved a generic tariff of ₹2.82 (~$0.030)/kWh for surplus rooftop solar power, along with variable charges of ₹6.85 (~$0.073)/kWh for biomass projects and ₹5.29 (~$0.056)/kWh for non-fossil fuel-based co-generation projects for financial year (FY) 2026–27.

These tariffs remain largely unchanged from FY 2026. Rooftop solar tariff and co-generation variable charges have remained the same, while the biomass variable charge has decreased marginally by around 0.3% from ₹6.87 (~$0.073)/kWh.

The approved tariff and variable charges will be applicable from April 1, 2026.

The Commission clarified that under the MERC (Renewable Energy Tariff) Regulations, 2019, tariffs for most renewable energy technologies, including wind, solar, biomass, co-generation, and hybrid projects, must be determined through competitive bidding, with the Commission only adopting discovered tariffs.

Accordingly, the present order is limited to notifying the generic tariff for rooftop solar and determining variable charges for certain biomass and co-generation projects.

The Commission noted that no distribution licensee in Maharashtra has discovered a tariff for rooftop solar procurement through competitive bidding. In such a scenario, and in line with regulatory provisions, the regulator considered the latest adopted tariffs for grid-scale solar projects, specifically those adopted in the range of ₹2.82 (~$0.030)/kWh to ₹3.10 (~$0.033)/kWh under a previous order, and selected ₹2.82 (~$0.030)/kWh as the applicable rate.

MERC noted that stakeholders sought higher compensation for surplus rooftop solar generation, including suggestions to link the rate to retail tariffs or the average power purchase cost (APPC). However, the Commission rejected these proposals, stating that rooftop solar systems are expected to be installed primarily for self-consumption, with only limited and unintended surplus.

It said adopting higher procurement rates could increase the power purchase cost for distribution licensees. The Commission also declined to consider tariffs discovered in other states, citing differences in subsidy structures and regulatory frameworks.

Maharashtra State Electricity Distribution Company (MSEDCL) submitted that rooftop solar capacity in the state has reached approximately 5.1 GW across 687,000 consumers, with an annual surplus injection of around 300 million units. It raised concerns regarding grid management and procurement costs.

MSEDCL also referred to recently discovered tariffs as low as ₹2.24 (~$0.024)/kWh. The Commission, however, noted that such tariffs had not yet been adopted and therefore could not be considered as a reference under the regulations.

APPC Cost

The order reiterates the distinction between different rooftop solar arrangements. Under net metering and net billing, surplus energy is to be procured at the generic tariff approved by the Commission for the relevant year. Under gross metering, distribution licensees must enter into power purchase agreements at their respective APPC, which remains constant for the entire term of the agreement for projects commissioned in FY 2026-27.

MSEDCL’s APPC increased to ₹5.40 (~$0.057)/kWh from ₹5.15 (~$0.055)/kWh, reflecting a rise of around 4.9%.

BEST Undertaking’s APPC declined to ₹6.65 (~$0.071)/kWh from ₹6.72 (~$0.071)/kWh, a decrease of about 1.0%.

Adani Electricity Mumbai – Distribution’s APPC decreased to ₹5.11 (~$0.054)/kWh from ₹5.17 (~$0.055)/kWh, down by around 1.2%.

Tata Power Company – Distribution’s APPC fell to ₹6.01 (~$0.064)/kWh from ₹6.08 (~$0.064)/kWh, marking a decline of about 1.2%.

Other DISCOMs in the state have APPC values ranging between ₹2.85 (~$0.030)/kWh and ₹6.65 (~$0.071)/kWh for FY 2026–27, compared to a range of ₹4.26 (~$0.045)/kWh to ₹8.04 (~$0.085)/kWh in FY 2025–26, with some utilities seeing no change and others recording revisions.

The Commission noted that the Renewable Energy Tariff Regulations, 2019, have been extended for a second review period, covering FY 2025-26 to FY 2029-30, during which this order has been issued.

Subscribe to Mercom’s real-time Regulatory Updates to ensure you don’t miss any critical updates from the renewable industry.