Regulatory Developments in Renewable Sector: May 16, 2025

GERC approves tariffs for 500 MW BESS under GUVNL’s Phase-IV tender

The Gujarat Electricity Regulatory Commission (GERC) has approved tariffs discovered through Gujarat Urja Vikas Nigam Limited’s (GUVNL) Phase-IV global bidding for standalone Battery Energy Storage Systems (BESS) with a capacity of 500 MW/1000 MWh.

The procurement is aimed at meeting Gujarat’s Renewable Purchase Obligations (RPO) and Energy Storage Obligations (ESO) as mandated by the Ministry of Power. The petition was filed under Sections 63 and 86(1)(b) of the Electricity Act, 2003.

The bidding process, issued on 30 August 2024, was supported by central Viability Gap Funding (VGF) of up to Rs 27 lakh/MWh or 30% of project capex, whichever is lower. Projects were awarded to four developers—Kintech Synergy, H.G. Infra Engineering, Bhilwara Energy, and Advait Energy Transitions—through e-reverse auction. Tariffs ranged from Rs 2,25,985 to Rs 2,26,000 per MW per month, the lowest BESS rates discovered in Gujarat so far and 39% lower than Phase-III tariffs.

Despite the absence of standard bidding documents, GERC found the process compliant with Ministry guidelines. Project sites were selected based on grid integration studies by GETCO and GUVNL. The bid documents included safety and technical standards aligned with national and global norms.

The Commission approved tariff adoption and highlighted the role of BESS in supporting renewable integration and grid stability. Projects are expected to be commissioned in 18–24 months.

Petition No. 2448 of 2025 | Read the full order here.

UPERC releases draft rules for captive and renewable energy projects (2024–2029)

The Uttar Pradesh Electricity Regulatory Commission (UPERC) has issued draft regulations governing captive and renewable energy generating plants for the 2024–2029 period. The draft aims to formalize rules for grid connectivity, power banking, and tariffs across the state. Stakeholders have until May 30, 2025, to submit comments before a public hearing scheduled on June 3.

The regulations apply to captive non-renewable plants of 1 MW and above and renewable energy (RE) plants of 100 kW and above. The provisions cover power purchase agreements, banking of power, and tariff norms.

Tariffs for existing RE projects, coal, bagasse, biomass, municipal waste, and small hydro, are fixed. For instance, bagasse-based plants have tariffs between Rs 4.28 and Rs 4.77 per kWh based on commissioning date. New plants commissioned after April 1, 2024, will be subject to competitive bidding.

Banking provisions vary: bagasse plants may bank 49% of quarterly energy for use within two following quarters. Solar and wind plants can bank 25% of monthly generation or 30% of consumption, whichever is higher. Banking for non-renewable captive plants will be discontinued after a one-year transition.

Solar projects will receive full exemption from intra-state wheeling charges when supplying to discoms, and 50% exemption for third-party or captive use, aligning with the state’s 2022 solar policy.

UPERC also supports pilot RE technologies like hybrid systems, with tariff caps set at the state’s average power purchase cost. Waste-to-energy projects will receive case-specific tariffs.

Read the full draft here.

APSERC approves new small hydro tariffs for FY 2025–26

The Arunachal Pradesh State Electricity Regulatory Commission (APSERC) has issued its generic tariff order for small hydro projects for the financial year 2025–26. The order sets levelised tariffs for projects up to 1 MW in capacity, in compliance with the APSERC RE Tariff Regulations.

The order applies to two capacity bands: below 500 kW and between 500 kW to 1 MW. The Commission approved tariffs under two scenarios—one with no financial support and one with 100% government funding.

For projects without any incentives, grants, or subsidies, the approved levelised tariffs are Rs 7.04/kWh for capacities below 500 kW and Rs 5.90/kWh for 500 kW to 1 MW. For fully subsidised projects, the approved tariffs are significantly lower at Rs 2.39/kWh and Rs 1.80/kWh, respectively.

The tariff is based on a 40-year project life, a normative debt-equity ratio of 70:30, a post-tax return on equity of 14.5%, and an interest rate of 10.99% for debt. Operations and maintenance (O&M) expenses have been escalated by 5.89% over the tariff period. Depreciation is allowed up to 90% of capital cost, with a rate of 4.67% annually for the first 15 years and 0.80% thereafter.

Projects partially funded through government support are excluded from the generic tariff. Developers of such projects are required to file separate petitions with full details of the financial assistance received.

The order also outlines parameters used in determining tariffs, including a normative capacity utilisation factor (CUF) of 45%, auxiliary consumption of 1%, and interest on working capital at 12.24%. Capital costs are pegged at Rs 1,400 lakh/MW for projects below 500 kW and Rs 1,236 lakh/MW for projects between 500 kW and 1 MW.

The tariffs determined will apply to projects commissioned in FY 2025–26, the second year of the 2024–27 control period.

Petition No. TP- 04 of 2025 (Suo-Motu) | Read the full order here.

HERC approves solar PPAs at Rs 2.99/kWh after APTEL remand

The Haryana Electricity Regulatory Commission (HERC) has approved the execution of power purchase agreements (PPAs) with 13 solar developers, including Respondent No. 4, at a tariff of Rs 2.99/kWh. This follows the judgment of the Appellate Tribunal for Electricity (APTEL) dated 3 September 2024 in Appeal No. 208 of 2017, which set aside HERC’s earlier order from 2016 and remanded the matter for fresh consideration.

The case originated from HPPC’s 2015–16 competitive bidding process to procure 165 MW of solar power. Letters of Intent (LoIs) were issued to selected developers, but PPAs were never executed due to procedural delays and tariff disputes. The APTEL directed HERC to approve the PPAs between the developers (appellants) and HPPC (respondent), although no signed PPAs existed at the time of the original proceedings.

HERC noted that the APTEL’s order did not fix a tariff. While Respondent No. 4, Ms. Geeta Rani, argued for tariff approval at Rs 5/kWh, citing the original bid period, she failed to submit documents demonstrating significant project progress. Other developers agreed to match HPPC’s latest discovered tariff of Rs 2.99/kWh. The Commission concluded that the earlier tariff was no longer relevant due to the lack of project commissioning.

As a result, HERC approved the PPAs for all willing developers, including Ms. Rani, at Rs 2.99/kWh. The order permits developers to incorporate new project companies as per Clause 2.9 of the original tender. HERC also acknowledged that the civil appeal filed by HPPC against the APTEL order is pending before the Supreme Court but has not resulted in any stay.

Case No. HERC/Petition No. 68 of 2024 | Read the full order here.

KSERC approves 25-year wind PPA with CV Renewables at Rs 3.94/unit

The Kerala State Electricity Regulatory Commission (KSERC) has approved a 25-year power purchase agreement (PPA) between KSEB Ltd and CV Renewables Pvt Ltd for procurement of wind power at a generic tariff of Rs 3.94/unit.

The project is a 250 kW wind turbine located at Ramakkalmedu. The plant was synchronized on 16 August 2024 and declared commercially operational on 8 September 2024. CV Renewables had originally requested Rs 3.95/unit, citing high costs due to hilly terrain. KSEB agreed to the Commission’s generic tariff without accelerated depreciation.

KSERC clarified that since both parties agreed to the notified generic tariff, no project-specific tariff determination was needed. The Commission allowed KSEB to make payments at the approved rate from the date of synchronization and directed submission of the signed PPA post-execution.

Minor modifications were advised, including clarifying PPA extension terms and making compliance with upcoming deviation settlement and forecasting regulations binding on the generator.

Petition No. OP No 08/2025 | Read the full order here.

MERC approves Rs 2.79/kWh tariff for 400 MW intra-state solar power

The Maharashtra Electricity Regulatory Commission (MERC) has approved the procurement of 400 MW of solar power by MSEDCL from Avaada Energy Pvt Ltd at a tariff of Rs 2.79/kWh for 25 years. The tariff was discovered through a competitive bidding process conducted in April 2023 and finalised in February 2024.

MSEDCL floated the tender for intra-state solar projects due to transmission constraints for interstate power. Avaada had initially matched the L1 bid of Rs 2.87/kWh but later offered a reduced tariff of Rs 2.79/kWh. No ceiling cap was applied in the bidding process.

MERC found the tariff reflective of market conditions, noting that other recent bids ranged from Rs 2.52 to Rs 2.67/kWh at the national level. After adjusting for Maharashtra-specific costs like land, financing, and CUF variation, the Rs 2.79/kWh rate was found reasonable.

The power will count towards MSEDCL’s Renewable Purchase Obligation (RPO) under the ‘Other RPO’ category and will help bridge a cumulative shortfall of 8,525 MUs till FY 2022–23. The Commission directed MSEDCL to sign the PPA with Avaada for a 25-year term.

Petition No. Case No. 88 of 2024 | Read the full order here.

GERC approves Rs 2.95/unit tariff for PM-KUSUM solar projects in Gujarat

The Gujarat Electricity Regulatory Commission (GERC) has approved a levelized tariff of Rs 2.95 per unit for purchasing power from decentralised solar and other renewable energy projects under Component A of the PM-KUSUM scheme.

The petition was filed jointly by Gujarat’s four DISCOMs—DGVCL, MGVCL, PGVCL, and UGVCL—along with GUVNL. 

Component-A of PM-KUSUM enables farmers and rural bodies to set up 500 kW to 2 MW solar or RE plants near substations to supply power locally and generate income. If the applied capacity at a substation exceeds its limit, Rs 2.95/unit will serve as the ceiling rate for competitive bidding.

GERC acknowledged that this tariff is about 26% higher than GUVNL’s earlier discovered Rs 2.30/unit rate, citing higher capital and operating costs for small-scale projects. The Gujarat government will pass on Rs 0.05/unit from MNRE’s Rs 0.08/unit Performance-Based Incentive (PBI), reducing the effective cost to DISCOMs to Rs 2.90/unit.

The Commission highlighted the scheme’s role in boosting clean energy while enhancing farm incomes. It also noted that other states offer similar premium tariffs to attract participation from small RE developers.

GERC directed the DISCOMs to sign Power Purchase Agreements (PPAs) at the approved tariff or lower, and ensure that draft PPAs align with central guidelines, especially in scope and dispute resolution.

CERC allows BYPL to withdraw petition over renewable power diversion

The Central Electricity Regulatory Commission (CERC) has disposed of filed by BSES Yamuna Power Limited (BYPL) against SBSR Power Cleantech Eleven Private Limited (SBSR) and Solar Energy Corporation of India (SECI). The petition concerned alleged diversion of 62.5 MW of contracted renewable power to third parties.

BYPL, a beneficiary under a Power Supply Agreement dated 17 June 2019 and a Power Purchase Agreement dated 20 August 2019, claimed SBSR unlawfully diverted the agreed capacity, depriving it of renewable energy. BYPL sought directions for restoring the diverted power, halting further third-party sales, and compensation for extra costs incurred to meet Renewable Purchase Obligations.

BYPL referred to similar pending petitions (Nos. 192/MP/2021 and 235/MP/2023) and initially requested consolidation. However, it later withdrew the case. The respondents did not object. CERC permitted the withdrawal and allowed BYPL to file an affidavit and pursue other legal remedies.

Petition No. 174/MP/2024 | Read the full order here.

GERC approves tariffs for 1,000 MW solar under GUVNL Phase XXV

The Gujarat Electricity Regulatory Commission (GERC) has approved tariffs discovered through Gujarat Urja Vikas Nigam Limited’s (GUVNL) Phase XXV bidding for 500 MW solar capacity, along with an additional 500 MW under the Greenshoe option.

An e-reverse auction set the lowest tariff at Rs 2.55/kWh. Seven developers were selected for the base capacity: S.B.B. Mouldings, Kintech Synergy, Enertech Fuel Solutions, Prozeal Green Energy, Ausom Enterprise, Drashta Green Power, and SAEL Industries. SAEL was allocated 240 MW at Rs 2.56/kWh as its bid fell within the L1+2% range.

The Greenshoe option allowed additional capacity allotment at the L1 tariff. Enertech accepted 203 MW, SAEL added 240 MW, Kintech took 50 MW, and Drashta accepted 7 MW. Prozeal, Ausom, and S.B.B. Mouldings declined additional capacity.

The final contracted capacity stood at 1,000 MW, with a weighted average tariff between Rs 2.55 and Rs 2.555/kWh. GERC found the process transparent and compliant with national guidelines. GUVNL noted that the tie-up is crucial to meet Gujarat’s Renewable Purchase Obligation (RPO) targets and ensure daytime power supply for agriculture.

Petition No. 2403 of 2024 | Read the full order here.

For more regulatory updates, read the latest orders covered on Power Peak Digest: Energy Regulatory Updates – Power Peak Digest 

Featured photograph is for representation only.