Regulatory Developments in Renewable Sector: June 2, 2025

RERC finalises Green Energy Open Access Regulations, 2025 

The Rajasthan Electricity Regulatory Commission (RERC) has finalised the Green Energy Open Access (GEOA) Regulations, 2025, with the order issued on 21 May 2025. Developed following stakeholder consultations, the regulations aim to promote renewable energy adoption while addressing critical issues such as eligibility, banking, charges, and dispute resolution.

Under the new framework, consumers with a contract demand of 100 kW or more are eligible for green energy open access, while captive users face no minimum load requirement. Recognised renewable sources include solar, wind, hydro, and green hydrogen or ammonia projects. Captive consumers are allowed to bank up to 30% of their monthly consumption, subject to an 8% charge on banked energy.

Transmission and wheeling charges for hybrid projects will be levied on contracted capacity. Battery storage systems are exempt from these charges. Cross-subsidy surcharges are capped at 20% of the average cost of supply, while additional surcharges may apply in cases of fixed cost under-recovery. Standby charges are fixed at 25% of energy charges but can be waived with advance intimation.

RERC addressed stakeholder concerns on issues such as banking limits, capacity sizing for captive plants, and applicable charges. It clarified that renewable energy projects exceeding 100% of contract demand must be paired with energy storage. Banking provisions for green hydrogen and ammonia production will align with Rajasthan’s state policy.

The final regulations give priority to green energy consumers over conventional open access users and establish protocols for curtailment. They also mandate metering and communication standards, and provide for dispute resolution through the State Load Dispatch Centre (SLDC) or the Commission itself.

Petition No. 2264/2024 | Read the full order here.

HERC revises net worth formula for QCAs to ease renewable integration

The Haryana Electricity Regulatory Commission (HERC) has amended the net worth calculation formula for Qualified Coordinating Agencies (QCAs) under its 2019 regulations for forecasting, scheduling, and deviation settlement of solar and wind power. Issued on May 22, 2025, the order responds to concerns from developers and QCAs about a “double deduction” of liabilities that had disqualified eligible entities and delayed projects.

Petitioners CMES Power 2 Private Limited and Ask Automotive Limited argued that the existing formula—Net Worth = Share Capital + Reserve – Revaluation Reserve – Intangible Asset – Misc. Expenditure – Carried Forward Losses – Liabilities—violated the Companies Act, 2013 by subtracting liabilities twice. HVPNL, the state transmission utility, supported the revision, admitting the formula’s impracticality.

Aligning the definition with the Companies Act, HERC removed the liabilities deduction. The revised formula now reads: Net Worth = Share Capital + Reserve – Revaluation Reserve – Intangible Asset – Misc. Expenditure – Carried Forward Losses.

The commission cited its authority under Regulations 18–20 of the Deviation Settlement Mechanism Regulations, 2019, to amend provisions in the interest of grid stability and renewable energy integration. Interveners such as REConnect Energy Solutions noted the previous formula distorted net worth assessments. However, HERC declined broader eligibility changes, stating they were beyond the petition’s scope.

Case No. HERC/P. No. 20 of 2025  | Read the full order here.

APTEL sets aside tariff reduction for Tungabhadra Solar project over misapplied commissioning date rule

The Appellate Tribunal for Electricity (APTEL) on 16 May 2025 ruled in favour of Tungabhadra Solar Parks Pvt Ltd, setting aside Karnataka Electricity Regulatory Commission’s (KERC) 2018 order that had upheld a tariff cut and liquidated damages for delay in project commissioning.

Tungabhadra Solar was set up as a special purpose vehicle to develop a 20 MW solar power project in Chikkodi Taluk, Karnataka, under a 2015 bidding process by Karnataka Renewable Energy Development Ltd (KREDL). A Power Purchase Agreement (PPA) was executed on 3 June 2016 with Gulbarga Electricity Supply Company Ltd (GESCOM), later approved by KERC on 7 October 2016.

Disputes arose over the “Effective Date” for calculating the Scheduled Commissioning Date (SCOD). Though earlier clarifications had shifted the Effective Date to the PPA approval date, KREDL issued an Office Memorandum on 27 May 2016 stating otherwise. After KERC accepted Tungabhadra’s plea in a 2017 review, the Effective Date was clarified as 7 October 2016.

However, KERC later rejected Tungabhadra’s request for a 125-day extension to achieve conditions precedent and upheld GESCOM’s imposition of Rs 1.2 million in liquidated damages. It further noted the plant had not injected power into the grid on 6 October 2017—the SCOD—and observed this could justify a tariff reduction to Rs 4.36/kWh from the agreed Rs 5.46/kWh.

APTEL ruled that these observations were unwarranted. The issue of commissioning date and tariff reduction had not been raised or argued in the original petition. The Tribunal held that KERC’s reliance on its earlier ruling in O.P. No. 18 of 2018—subsequently set aside by APTEL and upheld by the Supreme Court in 2021—was erroneous.

APTEL held that Tungabhadra’s project was commissioned on time and is entitled to the original tariff of Rs 5.46/kWh. The Rs 1.2 million in damages, already adjusted, was not contested further. APTEL directed the company to approach KERC to seek tariff restoration and recover shortfall payments, with a decision due in four months.

Appeal No. 110 of 2019  | Read the full order here.

APTEL orders CERC to reassess solar O&M GST claims in light of settled case law

On 27 May 2025, the Appellate Tribunal for Electricity (APTEL) directed the Central Electricity Regulatory Commission (CERC) to reconsider its earlier orders denying GST-related Operation and Maintenance (O&M) cost compensation under the Change in Law clause for multiple solar developers affiliated with Azure Power. The appeals—spanning cases from 2018 to 2023—were clubbed and adjudicated together.

The Tribunal held that the introduction of the Goods and Services Tax (GST) on 1 July 2017 qualifies as a Change in Law under the power purchase agreements (PPAs) signed by the solar developers. While CERC had previously allowed relief for GST impact on Engineering, Procurement and Construction (EPC) costs, it denied compensation for O&M costs if those services were outsourced, stating it was a commercial decision of the developer.

APTEL rejected this reasoning, citing its own precedent in the Parampujya Solar case (Appeal No. 256 of 2019), which confirmed that outsourced O&M costs also qualify for Change in Law relief. The Tribunal ruled that the nature of cost recovery should not depend on whether the O&M services were performed in-house or contracted out, as long as they were incurred due to a law change.

The Tribunal also addressed claims for carrying cost—interest on delayed compensation payments—and confirmed that developers are entitled to it to ensure full restitution. APTEL held that denial of carrying cost undermines the principle of placing the developer in the same economic position as if the Change in Law had not occurred.

The Tribunal directed CERC to reassess the claims for increased O&M expenses and carrying costs in line with the legal principles laid out in the Parampujya judgment. It also asked that the CERC’s fresh order not be enforced until the Supreme Court disposes of pending related appeals.

APL No. 394 OF 2018, 395 OF 2018, 398 OF 2018, 399 OF 2018, 65 OF 2023 & 901 OF 2023 | Read the full order here.

APTEL reinstates Guttaseema Wind’s full 80 MW PPA 

In a significant win for renewable energy developers, the Appellate Tribunal for Electricity (APTEL) on 29 May 2025 set aside an order of the Andhra Pradesh Electricity Regulatory Commission (APERC) that had upheld partial termination of a 80 MW Power Purchase Agreement (PPA) between Guttaseema Wind Energy Company Pvt Ltd and Southern Power Distribution Company of Andhra Pradesh Ltd (SPDCL).

The Tribunal held that the full project had achieved Commercial Operation Date (COD) under the PPA terms and directed SPDCL to allow synchronization of the remaining capacity.

The dispute arose after SPDCL terminated 60 MW of the contracted capacity through a notice dated 1 July 2020, claiming the developer failed to achieve full COD within two years of signing the PPA on 9 May 2016. Guttaseema had commissioned 20 MW by March 2018, but alleged SPDCL failed to act on repeated requests for synchronization of additional capacity.

APERC, in an April 2022 order, sided with SPDCL, stating that only individual generating units could be treated as having achieved COD and ruled that the project failed to meet the deadline.

However, APTEL ruled that the Commission had incorrectly interpreted Article 1.4 of the PPA, which explicitly states that for non-conventional energy projects, the synchronization date of the first unit shall be treated as the COD of the entire project. The Tribunal emphasized that both parties, including SPDCL, had knowingly signed the PPA with this clause, and the Commission had approved it.

APTEL observed that treating the commissioning of the first unit (22 March 2018) as the project’s COD meant it was within the two-year deadline. It also criticized APERC for ignoring the contract’s plain meaning and overemphasizing potential market impacts.

The Tribunal quashed SPDCL’s termination notice and directed immediate synchronization of the 20 MW unit ready since May 2019. It also granted deemed generation benefit from that date and ordered SPDCL to permit synchronization of the remaining 40 MW.

Appeal No.235 OF 2022 | Read the full order here.

CERC allows Coastal Energen partial cost pass-through  

The Central Electricity Regulatory Commission (CERC) has partially allowed the plea of Coastal Energen Private Limited (CEPL) seeking compensation for higher energy charges incurred during the Ministry of Power’s (MoP) emergency directives in 2022. These directives, issued under Section 11(1) of the Electricity Act, required imported coal-based generators to operate during a coal shortage.

CEPL, which runs a 1200 MW imported coal-based thermal plant in Tamil Nadu, was directed to run at full capacity from May to December 2022. The company argued that the Energy Charge Rate (ECR) set by a central committee—Rs 6.80/kWh—did not reflect its actual generation costs, which it pegged at Rs 8.70/kWh. CEPL sought CERC’s approval under Section 11(2) for full cost pass-through and requested Rs 300 crores from TANGEDCO to meet working capital requirements.

The key legal issue was whether CERC had jurisdiction to offset the financial impact of MoP’s directives. CERC affirmed its jurisdiction under Section 79 of the Act, citing that the power supply was inter-State in nature due to Section 11 orders, even if CEPL mainly supplied power to Tamil Nadu.

TANGEDCO opposed the claim, arguing that the MoP’s benchmark tariff already covered increased costs and that CEPL used domestic coal in violation of the PPA terms. It also challenged CEPL’s coal sourcing practices and questioned inclusion of costs like secondary oil and transport charges.

CERC held that MoP’s benchmark ECRs were interim and that the Commission alone was empowered to assess adverse financial impact. It ruled that CEPL was entitled to recover energy charges based on actuals, but only within the framework of efficient norms. The Commission allowed CEPL to claim reasonable fuel costs, port charges, and verified transportation expenses. It excluded costs unsupported by documentation or inconsistent with the Power Purchase Agreement.

The final approved ECR will be based on CERC’s tariff norms, including prudent coal price, heat rate, and auxiliary consumption benchmarks. The Commission did not rule on CEPL’s Rs 300 crore working capital request.

Petition No. 161/MP/2022 | Read the full order here.

JSERC approves tariff true-up for JUUNL’s Sikidiri Hydel Project

The Jharkhand State Electricity Regulatory Commission (JSERC) has approved the true-up petition submitted by Jharkhand Urja Utpadan Nigam Limited (JUUNL) for FY 2021–22 and FY 2022–23. The petition pertains to tariff adjustments for the 130 MW Swarn Rekha Hydel Power Project (SRHP) located in Sikidiri.

JSERC examined and approved key operational parameters, including plant availability factor, auxiliary consumption, and gross generation. The commission accepted a plant availability factor of 87.66% for FY 2021–22 and 83.37% for FY 2022–23—both well above the normative benchmark of 50%. Auxiliary consumption was approved at just 0.06% and 0.05%, respectively, compared to the normative 0.7%.

Operational and maintenance (O&M) expenses, depreciation, interest on loans, and return on equity (RoE) were also reviewed. While the commission allowed the actual O&M costs, it mandated a 50:50 gain-sharing mechanism between JUUNL and beneficiaries, citing efficiencies in O&M and auxiliary consumption. The approved annual fixed costs were Rs 30.61 crore for FY 2021–22 and Rs 37.90 crore for FY 2022–23.

JSERC noted a revenue gap of Rs 41.71 crore in FY 2021–22 and Rs 64.11 crore in FY 2022–23, inclusive of carrying costs. The commission directed JUUNL to expedite submission of detailed project reports (DPRs) and complete the residual life assessment (RLA) for the plant.

Case (Tariff) No.: 02 of 2025 | Read the full order here.

APERC issues draft regulations for renewable energy tariff determination till 2030

The Andhra Pradesh Electricity Regulatory Commission (APERC) has issued the Draft Terms and Conditions for Tariff Determination from Renewable Energy Sources Regulations, 2025.

Framed under Sections 61, 62, and 86 of the Electricity Act, 2003, the regulation sets out tariff norms for various renewable energy technologies including wind, solar, small hydro, biomass, and hybrid systems, along with storage-integrated projects. It follows Supreme Court and APTEL directives mandating State Commissions to codify tariff criteria and balance market-based and regulated methods.

The regulation allows tariff determination through Section 62 in cases not covered under competitive bidding. It introduces project-specific tariff petitions with ceiling norms for financial parameters like capital cost, debt-equity ratio (70:30), return on equity (14%/15%), and interest on loans and working capital tied to SBI MCLR. Tariffs will be levelized over the useful life of projects.

Technology-wise parameters include specific capacity utilization factors, auxiliary consumption limits, and O&M benchmarks. A uniform rebate and surcharge structure is specified. Over-generation is compensated at Rs 0.50/kWh, subject to cumulative limits.

The regulation also mandates disclosure of any government subsidy or incentive and outlines its treatment in tariff computation.

The draft is open for stakeholder comments before final notification in the Andhra Pradesh Gazette.

Read the full order here.

AERC declares SEIPL solar tariff case infructuous  

The Assam Electricity Regulatory Commission (AERC) has declared Petition No. 03/2017 by Suryataap Energies and Infrastructure Pvt. Ltd. (SEIPL) infructuous following the Appellate Tribunal for Electricity’s (APTEL) final judgment upholding the Commission’s 2017 tariff order.

SEIPL operates a 5 MW solar PV plant in Balipara, Assam, selling power to APDCL under a 2014 PPA. AERC had previously determined a project-specific tariff of Rs 8.78/kWh for 25 years from the plant’s commissioning on August 20, 2016.

APDCL appealed to APTEL, which initially remanded the case in December 2024, directing AERC to reassess the tariff using prevailing benchmark norms. SEIPL filed a review petition, contending that AERC had applied its own regulatory framework with due diligence and had not blindly adopted CERC benchmarks.

In its final order dated April 28, 2025, APTEL admitted a material error in its earlier judgment, stating that AERC had exercised proper regulatory discretion. It set aside its December 2024 remand and affirmed AERC’s original 2017 order.

In view of APTEL’s reversal, AERC concluded the petition was no longer relevant and disposed it as infructuous.

Petition No.: 03 /2017 | Read the full order here.

CSERC grants exemption from dedicated feeder for solar open access drawal

The Chhattisgarh State Electricity Regulatory Commission (CSERC) has allowed M/s Clean Coal Enterprises Pvt. Ltd. and its associated consumers M/s SB Hospitality and M/s Raipur Green Energy Pvt. Ltd. to avail long-term open access for solar power without a dedicated feeder.

The petitioners sought exemption under Clause 5(5) of the CSERC (Connectivity and Intra-State Open Access) Regulations, 2011, citing that their injection and drawal points lie within the distribution network and no transmission system is involved. CSPDCL and CSPTCL objected, stating the drawal entities were not bulk consumers as defined under the Open Access Regulations.

However, the Commission held that its 2019 regulations on distributed renewable energy, which allow exemptions for solar projects up to 500 kW and under specific schemes like KUSUM, override general open access norms. The petitioners also committed to comply with metering, communication, and load restriction requirements.

Finding merit in the request and compliance with regulatory conditions, the Commission granted exemption from dedicated feeder connectivity, permitting open access subject to the respondents’ conditions.

Petition No. 14 of 2025 | Read the full order here.

KSERC rejects tariff hike for micro/mini hydro projects below 500 kW

The Kerala State Electricity Regulatory Commission (KSERC) dismissed M/s Sleeba Vellakayam Hydro Project Pvt. Ltd.’s petition seeking a tariff increase to Rs 6.25–6.50 per unit for hydro projects under 500 kW. The commission upheld the existing tariff of Rs 5.39–5.72 per unit for projects up to 2 MW, as per the 2022 Renewable Energy Regulations.

The petitioner cited higher capital and operational costs due to terrain and inflation and requested a revised “letter of comfort” from Kerala State Electricity Board (KSEB) for financing. KSEB opposed, noting the current tariff, set through competitive norms, is a ceiling and reserving rights to procure power via bidding under Section 63 of the Electricity Act, 2003.

KSERC ruled that tariff changes require formal regulatory amendments, not individual petitions. The developer was advised to negotiate within the existing tariff ceiling or seek state subsidies through the Energy Management Centre. The commission rejected claims that higher actual capital costs justify tariff hikes, emphasizing normative cost standards.

KSERC’s order directs the petitioner to pursue subsidies or revised power purchase terms with KSEB, reaffirming the current tariff framework for small hydro projects.

Petition No. OP No. 25/2024 | Read the full order here.

KSERC rejects tariff hike plea for micro hydel project citing regulatory limits

The Kerala State Electricity Regulatory Commission (KSERC) has rejected a petition filed by M/s Sleeba Vellakayam Hydro Project Pvt. Ltd. seeking approval of a higher generic tariff for micro and mini hydropower projects below 500 kW capacity. The petitioner requested a tariff of Rs 6.25/unit with accelerated depreciation and Rs 6.50/unit without it, citing high capital and operation costs.

The petitioner is developing a 90 kW project in Idukki district and argued that the currently approved generic tariff of Rs 5.39/unit (with depreciation) and Rs 5.72/unit (without depreciation), applicable to small hydro projects up to 2 MW, is not financially viable for sub-500 kW projects. They highlighted challenges such as lack of central subsidies, high per-kW capital costs, and static O&M expenses regardless of scale.

KSERC ruled that it cannot amend the existing tariff through a developer’s petition without going through a formal regulation amendment process, including public consultation, as required by the Electricity Act and related rules. The Commission stated that tariff changes must follow the procedure outlined in the KSERC (Renewable Energy & Net Metering) Regulations, 2020 and its 2022 amendment.

However, the Commission acknowledged the economic challenges faced by small projects and encouraged the petitioner to negotiate a tariff with Kerala State Electricity Board Ltd (KSEBL), subject to the ceiling of the existing generic tariff. KSERC advised the petitioner to approach the state government, through the Energy Management Centre (EMC), to seek viability gap funding or capital subsidies for such projects.

The petition was dismissed on procedural grounds, but the Commission clarified that it is open to approving a mutually agreed power purchase agreement (PPA) between the developer and KSEBL, provided the tariff remains within the current regulatory ceiling.

Petition No. OP No. 24/2024 | Read the full order here.

RERC allows compensation for bird diverter costs, rules it a ‘Change in Law’

The Rajasthan Electricity Regulatory Commission (RERC) has ruled that the mandatory installation of bird diverters on transmission lines qualifies as a “Change in Law” under power purchase agreements (PPAs), entitling several wind power developers—including Ratedi Wind Power, Tanot Wind Power Ventures, Khandke Wind Energy, and Lalpur Wind Energy—to compensation.

The developers sought relief for costs incurred following Supreme Court orders dated April 19, 2021, and April 21, 2022, which mandated bird diverters or undergrounding of lines in habitats critical to the Great Indian Bustard. They invoked Article 12 of their PPAs and the Electricity (Timely Recovery of Costs due to Change in Law) Rules, 2021.

Rajasthan Urja Vikas Nigam Ltd (RUVNL) and state discoms opposed the petitions, arguing the rules were not retrospective and that developers made changes unilaterally. RERC rejected these arguments, affirming that Supreme Court orders are binding under Article 141 of the Constitution and that the bird diverter costs, not accounted for during tariff approval, warrant compensation.

RERC directed parties to reconcile actual expenditure incurred between April 19, 2021, and March 21, 2024, based on audited records and link it to specific projects and invoices. The Commission also approved carrying costs at the lowest applicable rate, and ordered annuity payments at a 9% discount rate over 15 years or the remaining PPA term, whichever is shorter. SECI and RUVNL must begin payments within 60 days of the order or claim submission, with late payment surcharges applicable for delays.

Petition No. RERC/2106/2023,2107/2023,2108/2023, 2109/2023, 2110/2023, 2111/2023 | Read the full order here.

TGERC approves 200 MW solar power procurement from NLCIL under CPSU Scheme Phase-II

The Telangana Electricity Regulatory Commission (TGERC) has approved the procurement of 200 MW of solar power from NLC India Limited (NLCIL) under the Central Public Sector Undertaking (CPSU) Scheme Phase-II, Tranche-III. The order, dated 17 May 2025, addresses key issues raised during public consultations, including tariff competitiveness, interstate transmission charges, and renewable purchase obligations (RPO).

The Southern and Northern Power Distribution Companies of Telangana (TGDISCOMs) sought approval for a tariff of Rs 2.57 per kWh, revised from Rs 2.45 due to increased GST rates. While stakeholders questioned the cost-effectiveness compared to competitive bidding, TGERC noted the tariff aligns with recent solar project rates set by the Central Electricity Regulatory Commission (CERC). The Gujarat-based project has a capacity utilisation factor (CUF) of 28.69%, higher than Telangana’s average, supporting the tariff justification.

Concerns over interstate transmission system (ISTS) charges, which could add Rs 1.20 per unit, were addressed by TGERC clarifying that only 25% of ISTS charges apply, per Ministry of Power guidelines for projects commissioned by June 2026. The Commission also instructed TGDISCOMs to pursue waivers of ISTS charges as per central policies.

The procurement supports Telangana’s RPO targets and growing energy demand, expected to exceed 150,000 million units by 2034-35. TGDISCOMs highlighted the importance of integrating renewables to reduce dependence on thermal power and meet national climate commitments. TGERC emphasised balancing consumer interests with long-term energy security, noting the advantages of solar’s fixed tariff amid rising thermal costs.

The Commission mandated prior approval for future procurement agreements and maintained the power purchase agreement’s validity pending CERC tariff adoption.

Petition No. O. P. No. 29 of 2025 | Read the full order here.

WBERC approves Rs 5.45/kWh tariff for 1,492 MW thermal power from JSW Energy

The West Bengal Electricity Regulatory Commission (WBERC) has approved a tariff of Rs 5.45 per kWh for the long-term procurement of 1,492 MW from a proposed 2×800 MW thermal power plant to be developed by JSW Energy Limited. The order, dated May 28, 2025, follows a competitive bidding process conducted under Section 63 of the Electricity Act, 2003.

The West Bengal State Electricity Distribution Company Limited (WBSEDCL) had sought tariff adoption after JSW Energy emerged as the lowest bidder in a two-stage e-reverse auction. Competing against Adani Power and Torrent Power, JSW’s final offer was reduced from an initial Rs 5.747 per kWh to Rs 5.45 per kWh, securing the contract on a Design, Build, Finance, Own, and Operate (DBFOO) basis.

The bidding process included key milestones such as the RFQ issued on October 3, 2024, pre-bid meetings, and a mock reverse auction. The Evaluation Committee confirmed that all bidding guidelines were followed, and coal supply was secured under the Ministry of Coal’s SHAKTI policy.

Petition No. CASE NO. OA -513/24-2 | Read the full order here.

WBERC clears discounted tariff deal for NHPC’s Teesta-IV hydro project

The West Bengal Electricity Regulatory Commission (WBERC) has approved a supplementary power purchase agreement (PPA) between WBSEDCL and NHPC Limited for the 160 MW Teesta Low Dam-IV hydropower station, enabling discounted tariffs until 2031. The order, issued on May 15, 2025, replaces Central Electricity Regulatory Commission (CERC)-determined rates with a mutually agreed single-part tariff structure.

Under the revised terms, the tariff is fixed at Rs 4.35/kWh for FY 2021–26 and Rs 4.46/kWh for FY 2026–31, averaging Rs 4.39/kWh—significantly below the previous CERC rate of Rs 4.61/kWh. The deal also mandates NHPC to refund excess amounts collected since April 2021 and protects WBSEDCL from future cost escalations.

The revised PPA extends the original 2005 agreement to align with the plant’s remaining life. It retains WBSEDCL’s exclusive rights to the project’s full capacity, which was allocated to West Bengal by the Ministry of Power in 2015.

WBERC’s approval reflects a growing trend of renegotiating hydro tariffs to reduce the financial burden of cost overruns—Teesta-IV’s final capital cost reached Rs 1,698.86 crore—and to ensure long-term price stability from firm renewable sources.

Petition No. CASE NO. PPРА-31/10-11 | Read the full order here.

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