HPERC proposes generic solar tariff for FY 2026–27

The Himachal Pradesh Electricity Regulatory Commission (HPERC) issued an order dated January 6, 2026, proposing the generic levellised tariff for grid-connected solar photovoltaic (PV) projects for the financial year 2026–27 under its 2017 renewable energy tariff regulations. The Commission stated it was acting under Regulation 18, which provides that the body “may, after having fixed the norms/parameters and other related terms and conditions… determine, or otherwise fix, by order, either generic levellised tariff(s) for any or all categories of such renewable energy technology(ies).”

The order categorizes solar PV projects based on capacity at a single site and location. Three primary capacity bands were retained: up to 1 MW, above 1 MW up to 3 MW, and above 3 MW up to 5 MW, with all projects over 5 MW falling into a separate fourth category where procurement is expected via competitive bidding. A distinct normative capital cost and resultant tariff were proposed for projects to be established in notified urban or industrial areas, with the Commission noting such locations “may generally help the distribution licensee to utilize the power from such plant in more optimal manner.”

Key technology-specific parameters were detailed, including a normative capital cost ranging from Rs. 335.79 lakh/MW to Rs. 360.46 lakh/MW depending on capacity and location, an operation and maintenance cost of Rs. 10.96 lakh/MW for FY 2026–27, and a capacity utilization factor of 21%. The tariff was calculated using a single-part levellised structure based on a debt-equity ratio of 70:30, a return on equity of 14%, and an interest rate on loan of 10.80% per annum.

The proposed generic levellised tariffs, to be applicable for projects where the power purchase agreement petition is submitted between April 1, 2026, and March 31, 2027, range from Rs. 3.34/kWh to Rs. 3.52/kWh. The tariffs do not incorporate any capital subsidy or grant, with adjustments to be made separately as per regulatory provisions. The order explicitly states that this tariff will not apply to power procured through the Solar Energy Corporation of India or competitive bidding under Section 63 of the Electricity Act, 2003, nor to rooftop or ground-mounted projects under net metering.

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