The Uttar Pradesh Electricity Regulatory Commission has approved the adoption of tariffs and the execution of Power Purchase Agreements for solar power projects under the PM KUSUM Component C-2 scheme. The decision was finalized in mid-December 2025 and is seen as an important step in Uttar Pradesh’s plan to solarize segregated agricultural feeders and ensure a reliable daytime electricity supply for farmers across the state.
The approval was issued under Petition No. 2254 of 2025, which was jointly filed by the U.P. New & Renewable Energy Development Agency and the Uttar Pradesh Power Corporation Ltd. The petition sought regulatory consent for tariffs discovered through a Tariff-Based Competitive Bidding process. Under this scheme, solar power plants will be directly connected to distribution substations that cater mainly to agricultural loads. The overall target capacity under this initiative is 2,553.5 MW, making it one of the largest feeder-level solar programs in the state.
According to the order, the bidding process attracted strong participation from developers, leading to competitive tariff discovery. The tariffs ranged between ₹2.20 per unit and ₹2.99 per unit. In the specific cases approved by the Commission, several Power Purchase Agreements had already been signed between successful bidders and UPPCL. These included 25 PPAs covering a total capacity of 82.6 MW and another 27 PPAs for 82.2 MW. The tariffs for these approved projects were in the range of about ₹2.79 to ₹2.99 per kilowatt-hour.
The PM KUSUM Component C-2 scheme is designed to deliver multiple benefits to different stakeholders. Farmers are expected to gain access to daytime solar power for irrigation, which can reduce dependence on unreliable or night-time electricity supply. In addition, farmers can earn a steady income by leasing unused or barren land for the development of solar projects, typically for a period of 27 years. This provides an additional and predictable revenue stream in rural areas.
For distribution companies such as UPPCL, the scheme helps reduce the cost of supplying power to the agriculture sector. Since the solar plants are located close to the load centers, transmission losses are also minimized. The use of solar power for agricultural feeders further supports compliance with Renewable Purchase Obligation requirements.
The Commission has also highlighted the importance of timely implementation. It has directed UPNEDA and UPPCL to extend active support to project developers, especially in achieving financial closure and completing project commissioning within the stipulated timelines. Smooth coordination among all stakeholders has been emphasized to ensure that the intended benefits reach farmers and the power sector without delays.
With this regulatory approval in place, a significant amount of solar capacity is expected to be added in the coming period. The move supports Uttar Pradesh’s broader objective of reducing subsidy burdens, strengthening rural power supply, and promoting a cleaner and more sustainable energy system.
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