PSERC approves PSPCL’s procurement of 340 MW FDRE power from SJVN
The Punjab State Electricity Regulatory Commission (PSERC) has approved Punjab State Power Corporation Limited’s (PSPCL) procurement of 340 MW of Firm and Dispatchable Renewable Energy (FDRE) power from SJVN Limited. The approval covers 140 MW from Ganeko One Energy Private Limited and 200 MW from Avaada Energy Private Limited.
The projects were awarded under SJVN’s FDRE tender issued on March 27, 2024, for a base capacity of 1,200 MW with a greenshoe option of an additional 1,200 MW. The Central Electricity Regulatory Commission (CERC) had adopted the discovered tariff of Rs 4.25/kWh on August 26, 2025, in Petition No. 312/AT/2025. PSPCL will pay a tariff of Rs 4.25/kWh along with a trading margin of Rs 0.07/kWh to SJVN, taking the total tariff to Rs 4.32/kWh, excluding applicable ISTS transmission charges and losses.
Reasons for procurement
PSPCL informed the Commission that the procurement is required to meet rising electricity demand, address its Renewable Purchase Obligation (RPO) requirements and secure firm renewable power during peak demand periods.
The utility stated that Punjab recorded an all-time peak demand of 16,670 MW on July 5, 2025, while the Central Electricity Authority’s Resource Adequacy Plan projects annual peak demand growth of around 6-7% through 2030.
PSPCL also submitted that its own tender for 1,000 MW of FDRE power, issued in November 2024, failed to attract meaningful participation despite multiple extensions.
The utility highlighted that the wind component of the hybrid projects will support Punjab’s night-time agricultural power supply, with the contracts requiring 90% firm availability for four hours daily during morning and evening peak periods.
Commission’s observations
The Commission noted that the projects will benefit from concessional Inter-State Transmission System (ISTS) charges based on their scheduled commissioning dates. Ganeko’s project, scheduled for commissioning on June 30, 2027, will qualify for a 50% ISTS transmission charge waiver, while Avaada’s project, scheduled for March 9, 2028, will receive a 25% waiver.
Based on these waivers, PSPCL estimated the landed cost of power at approximately Rs 4.77/kWh for Ganeko and Rs 4.92/kWh for Avaada, including ISTS charges and losses.
The Commission also observed that the discovered tariff of Rs 4.25/kWh is lower than tariffs discovered in several recent FDRE and peak power tenders cited by PSPCL.
Approval subject to CUF condition
PSERC approved the 200 MW procurement from Avaada Energy Private Limited subject to the incorporation of a committed Capacity Utilization Factor (CUF) of 65% in the Power Purchase Agreement (PPA) and Power Sale Agreement (PSA) through a supplementary agreement in accordance with Article 4.4.1 of the PPA.
The Commission noted that Avaada had confirmed the revised CUF through its letter dated June 12, 2026.
The order also records a pending Change in Law event relating to the reduction in Goods and Services Tax (GST) on renewable energy equipment from 12% to 5%. While PSPCL issued a Change in Law notice to SJVN, the developers submitted that the financial impact would crystallise only after project commissioning.
The Commission approved the procurement of the full 340 MW, subject to the Avaada CUF condition and commissioning of the projects within the applicable ISTS transmission charge waiver period. It clarified that the approval does not extend to the other terms and conditions of the PPA and PSA, which will be governed by the bidding documents or mutual agreement between the contracting parties.
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