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In response to a petition by the Solar Energy Corporation of India Limited (SECI), the Central Electricity Regulatory Commission (CERC) recently issued an order approving tariffs for 1,500 MW of solar power projects. These projects, part of the thirteenth tranche of the Inter-State Transmission System (ISTS), were selected through a competitive bidding process in line with guidelines set by the Ministry of Power in 2023. SECI’s petition sought the Commission’s approval to adopt the tariffs established through a reverse auction and requested approval for a trading margin of ?0.07 per kWh to be charged to distribution companies purchasing this power.
SECI’s competitive bidding process began with a Request for Selection (RfS) on December 29, 2023. The process, conducted via the ISN Electronic Tender System, drew bids from eleven companies, totaling a capacity of 4,030 MW. Of these, ten bidders met the required technical and financial criteria, qualifying them for the e-reverse auction on March 7, 2024. The auction awarded the 1,500 MW capacity as follows: JSW Neo Energy Limited received 700 MW at a rate of ?2.56/kWh, Sunsure Solarpark Fourteen Private Limited was allotted 300 MW at ?2.56/kWh, Tejorupa Renewables India Project Private Limited obtained 250 MW at ?2.56/kWh, and NTPC Renewable Energy Limited secured 250 MW at ?2.57/kWh.
During hearings in August and September 2024, SECI’s counsel reiterated the petition’s key points, underscoring the need for CERC’s approval to finalize the tariffs. SECI was directed to provide clarifications on procedural delays and updates on the execution of the Power Purchase Agreements (PPAs) and Power Sale Agreements (PSAs). SECI explained that previous regulatory orders required it to seek tariff approval only after finalizing these agreements. However, SECI noted that updated guidelines now specify a timeline for filing such petitions without waiting for PPA and PSA execution. CERC accepted this rationale, noting SECI’s commitment to adhere to these timelines in future petitions.
SECI presented certification confirming that the auction process complied with the Ministry’s guidelines and that the resulting tariffs reflected current market conditions. Based on this, CERC approved the tariffs, provided SECI continues with the execution of the PPAs and PSAs. Additionally, CERC addressed SECI’s request to approve a trading margin of ?0.07/kWh, stipulating that the margin would be capped at ?0.02/kWh unless SECI can establish an escrow arrangement or an irrevocable, unconditional letter of credit as security for solar generators.
CERC’s order supports SECI’s efforts to facilitate renewable energy procurement in line with regulatory guidelines, emphasizing transparency and market-competitive pricing. The order reflects CERC’s support for SECI’s role in advancing India’s renewable energy goals while maintaining regulatory oversight to ensure accountability and compliance within the solar power sector. |
