MERC Approves Tariff Proposed by MSEDCL for Procurement of 100 MW Solar Power on Long-Term Basis

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Maharashtra Electricity Regulatory Commission recently passed an order approving the tariff rate of Rs. 3.11/kWh for 100 MW Cumulative Capacity Grid Interactive Solar PV Power Projects on a long term basis for 25 years which is to be developed by Energy Efficiency Services Limited EESL.Along with the revised tariff rate commission also passed other orders regarding the Power Purchase Agreement (PPA) and Power Sale Agreement (PSA).

The Maharashtra State Power Generation Company Ltd. and Maharashtra State Electricity Distribution Company Ltd jointly filed a petition for seeking approval for tariff rate of Rs 3.11/kwh for long term procurement of power for 100 MW AC cumulative capacity of solar PV power projects in Western and Northern regions of Maharashtra under “Mukhyamantri Saur Krushi Vahini Yojana”.

Maharashtra State Power Generation Company Ltd. (MSPGCL) and Maharashtra State Electricity Distribution Company Ltd. (MSEDCL) were as follows: a) To approve the adoption of the Tariff rate of Rs. 3.11/kWh for 100 MWac Cumulative Capacity Grid Interactive Solar PV Power Projects to be developed by M/s. Energy Efficiency Services Ltd (EESL) at various locations in Western and North Maharashtra; b) Approve the proposed deviation concerning the Deemed Generation Clause and to approve the Draft PPA and PSA; c) To accord approval that the energy purchased by MSEDCL is entitled to the fulfillment of solar RPO target of MSEDCL.

The commission mentioned that the Commission has adopted the rate decided through MoU between MSPGCL and EESL and Order shall not be treated as a precedent. Besides, it also directed that MSPGCL and MSEDCL should approach the Commission jointly with deviations if any in the PPA and PSA. 

The Commission stated that it would like to take on record the submission of MSPGCL about its participation in the bids called by MSEDCL. This is a positive step towards the discovery of tariffs through a competitive bidding process. Having lauded the initiative of MSPGCL, it would not be prudent to continue in the future, the practice of adopting tariff based on MoU between two parties. 

The commission added that “In future if EESL or any other agency wishes to sign PPA with Distribution Licensee in the State, it should be based on Tariff discovered under Section 63 of the EA, 2003 unless there is a strong justification otherwise.”

The commission passed an order to adopt the Tariff rate of Rs. 3.11/kWh for 100 MWac Cumulative Capacity Grid Interactive Solar PV Power Projects on a long term basis for 25 years to be developed by Energy Efficiency Services Limited EESL at various locations in Western and North Maharashtra under “Mukhyamantri Saur Krushi Vahini Yojana”. 

The Commission accords its approval to the proposed deviations sought in the Deemed Generation Clause and also approves the Draft Power Purchase Agreement and Power Sale Agreement. 

The commission highlighted that “The Solar Power procured from these projects shall be eligible towards the fulfillment of Maharashtra State Electricity Distribution Co. Ltd’s Solar RPO for the respective periods”

In January 2020, The Maharashtra Electricity Regulatory Commission (MERC) has approved the tariff proposed by Maharashtra State Electricity Distribution Company Limited (MSEDCL) through the competitive bidding process, priced at of ₹2.89/kWh and ₹2.90/kWh for the purchase of solar power. The solar power thus procured will be used for the fulfillment of Maharashtra State Electricity Distribution Company Limited’s (MSEDCL) solar renewable purchase obligation (RPO). The tariffs proposed are in line with the changing market trends.

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