A recent development in India’s renewable energy sector has seen the Damodar Valley Corporation (DVC) filing a petition seeking the adoption of tariffs for 500 MW ISTS-connected Solar PV Power projects. This move comes under the Scheme for Flexibility in Generation and Scheduling of Thermal/ Hydro Power Stations through bundling with Renewable Energy and Storage Power.
DVC, acting as a generating company, initiated a competitive bidding process for selecting solar power developers for these projects. The process, overseen by REC Power Development and Consultancy Limited (RECPDCL), led to the selection of ReNew Solar Power Private Limited for 200 MW and Avaada Energy Private Limited for 300 MW. Letters of Award were issued after approval from DVC.
The adoption of tariffs is crucial for signing Power Purchase Agreements (PPAs) with the selected bidders. These agreements can only be finalized once tariffs are approved by the appropriate commission.
The Flexibility Scheme, introduced by the Ministry of Power in April 2022, allows thermal and hydropower stations to integrate renewable energy sources. It permits generating companies to establish or procure renewable energy for supplying power against existing commitments.
Under the scheme, renewable energy can be procured through competitive bidding or the establishment of renewable energy plants. Transmission charges are waived for renewable energy when co-located within a generating station’s premises or for use in inter-state transmission systems.
The scheme also ensures separate scheduling, metering, and accounting for renewable energy and traditional thermal/hydro generation. This facilitates Renewable Purchase Obligation (RPO) compliance for distribution licensees.
However, concerns have been raised regarding the consent of beneficiaries and the trading of electricity. Respondent parties, including Karnataka ESCOMs, have questioned the tariff rates and suggested negotiation with bidders. They also argue for more direct procurement of renewable energy by beneficiaries.
Despite these concerns, the commission has adopted the tariffs for the solar power projects, considering the transparent bidding process and compliance with guidelines. It emphasizes the importance of promoting renewable energy integration while ensuring financial benefits for beneficiaries.
Further consultations are recommended among stakeholders to address operational aspects of the Flexibility Scheme. The commission rejects requests for recovery of petition fees, stating that the petition was not filed under relevant tariff regulations. The adoption of tariffs for solar power projects under the Flexibility Scheme marks a significant step towards promoting renewable energy integration in India’s power sector. It underscores the need for transparent processes and stakeholder consultations to ensure effective implementation and maximize benefits for all parties involved.
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