In a significant ruling, the Rajasthan Electricity Regulatory Commission (RERC) has rejected a petition by the state-owned power trading company to procure 3.2 GW of coal-fired thermal power, saying the proposal is inconsistent with the state’s renewable energy policy framework.

It held that the proposal conflicts with the Central Electricity Authority’s Resource Adequacy Plan 2025, which projects that renewable energy-rich Rajasthan would require only 1,905 MW of new thermal capacity by 2035-36, far below the 3,200 MW sought by the petitioner, Rajasthan Urja Vikas and IT Services (RUVITL).

The regulator observed that the petitioner failed to justify the requirement for such a large quantity of new coal-based power.

The Commission pointed out contradictions and inconsistencies in the petitioner’s submissions. While RUVITL argued for urgent new thermal capacity, the Commission noted that 3,325 MW of new thermal capacity under joint ventures with NTPC, CIL, and NLCIL is already in advanced stages.

Holding the petitioner’s position as “unreasonable and inconsistent,” the Commission said the Rajasthan Integrated Clean Energy Policy, 2024, prioritizes large-scale deployment of renewable energy and energy storage technologies over conventional fossil-fuel-based generation.

It highlighted the state’s renewable energy trajectory, including 11,527 MW approved under the PM KUSUM program, rooftop solar installations surpassing 2 GW, a significant pipeline of battery energy storage projects, and consumer-friendly green energy open-access regulations.

“More importantly, captive plants are allowed up to 200% of their contract demand, subject to a storage mandate. The impact of these regulations will be visible in the near future, leading to a moderated growth trajectory in the distribution company’s (DISCOM) long-term demand,” it said.

Additionally, the Commission said it has notified Virtual Net Metering and Group Net Metering

Regulations enabling all consumer categories to participate in shared and aggregated renewable energy generation. “It is expected that substantial capacity addition will occur under these mechanisms, further reducing the net demand on the State distribution licensees.”

These developments, RERC said, are likely to reduce long-term demand on DISCOMs, weakening the case for new coal-based procurement.

The Commission also took note of stakeholder submissions that recent bids in other states for coal-based thermal power projects had discovered tariffs exceeding ₹6 (~$0.068)/kWh. “Furthermore, even for existing coal-based thermal plants located within Rajasthan, the tariff remains relatively high as compared to FDRE sources, where the discovered tariffs have reduced to the range of ₹3.00–₹4.00 (~$0.034-0.045)/kWh.”

Rejecting the petition, the Commission directed RUVITL to reassess the demand for thermal in line with the Resource Adequacy Plan, and submit a fresh, justified petition if a genuine capacity requirement still exists.