The Uttar Pradesh Electricity Regulatory Commission (UPERC) has approved the power sale agreement (PSA) between Uttar Pradesh Power Corporation (UPPCL) and NHPC for the procurement of 1,280 MW of firm and dispatchable renewable energy (FDRE) at tariffs ranging from ₹4.7 (~$0.0547)/kWh to ₹4.71 (~$0.0548)/kWh.

The Commission also approved a trading margin of ₹0.07 (~$0.0008)/kWh.

Background

The case originated from a petition filed by UPPCL seeking approval for the PSA with NHPC for procuring 1,280 MW of FDRE. NHPC was designated as the renewable energy implementing agency to conduct competitive bidding for the FDRE projects.

UPPCL argued that the procurement was necessary to fulfill its renewable purchase obligation (RPO) targets and reduce power procurement costs.

For the financial year 2025, the RPO target for distribution companies was set at 29.91%. UPPCL cited the Ministry of New and Renewable Energy’s February 1, 2024, letter that specified a penalty of ₹1 million (~$11,627.91) for failure to comply and an additional penalty of ₹3.72 (~$0.043)/kWh shortfall.

NHPC, through a petition filed before the Central Electricity Regulatory Commission (CERC), had sought adoption of the discovered tariffs. It submitted the final CERC order, which confirmed approval of tariffs for the 1,400 MW capacity (of which 1,280 MW would be allocated to UPPCL) and declared the bidding process transparent and compliant with government requirements.

Commission’s Analysis

UPERC noted that CERC had already adopted the tariffs for 1,400 MW of FDRE capacity, affirming that the process adhered to the specified guidelines. UPPCL’s allocation of 1,280 MW under the PSA was found to be in line with competitive procurement norms.

The Commission approved the PSA for the procurement of 1,280 MW of FDRE.

It also held that if NHPC fails to provide an escrow arrangement or an irrevocable, unconditional, and revolving letter of credit to the renewable energy power generators, the trading margin would be limited to ₹0.02 (~$0.0002)/kWh.

The approved tariffs for the six PPAs are as follows:

• Clean Renewable Energy AP One (100 MW at ₹4.70 (~$0.0547)/kWh)
• Solarcraft Power India 20 (50 MW at ₹4.70 (~$0.0547)/kWh)
• Juniper Green Light Ten (200 MW at ₹4.71 (~$0.0548)/kWh)
• Renew Wind Energy (AP Five) (250 MW at ₹4.71 (~$0.0548)/kWh)
• ACME Venus Urja (400 MW at ₹4.71 (~$0.0548)/kWh)
• ACME Hybrid Urja (280 MW at ₹4.71 (~$0.0548)/kWh)

Recently, UPERC approved a tariff of ₹3.84 (~$0.044)/kWh for the procurement of 300 MW wind-solar hybrid power by Noida Power Company.

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