GSECL Seeks Tariff Approval from GERC for 11 MW Solar Project in Morbi

Gujarat State Electricity Corporation Limited (GSECL) has filed a petition before the Gujarat Electricity Regulatory Commission (GERC) seeking approval for the project-specific tariff for its 11 MW Solar Photovoltaic power project located at Jambudiya Vidi in Morbi district of Gujarat. The petition outlines the financial and technical details of the project and requests the Commission to determine and approve the applicable tariff for electricity generation from the plant.

The solar project was developed under a Government of Gujarat initiative aimed at utilizing government wasteland located near substations of the Gujarat Energy Transmission Corporation (GETCO). The primary objective of this initiative is to promote renewable energy development while reducing infrastructure costs by using land that is otherwise unproductive and already close to the transmission network. This approach also helps in delivering affordable renewable electricity to consumers across the state.

Following a competitive bidding process, EPC contractor Prozeal Infra Renewable LLP was selected for the design, engineering, procurement, and construction of the solar power plant. The project was successfully completed and declared commercially operational on December 25, 2024.

According to the petition, the total capital cost of the project has been finalized at ₹74.86 crore. The project financing structure was designed with equal contributions from the Government of Gujarat and GSECL. A capital grant from the state government covered 50 percent of the total project cost, while the remaining 50 percent was funded through GSECL’s internal resources. The company has clarified that no external debt or bank loans were used for the development of the project.

However, for the purpose of tariff determination under the GERC Multi-Year Tariff Regulations, 2016, GSECL has adopted a normative debt-equity structure of 70:30, which is standard under regulatory guidelines. The tariff calculation submitted to the Commission includes several financial parameters. These include a Return on Equity of 14 percent, while operation and maintenance expenses are based on the actual contract value for the first five years, with an annual escalation of 5.25 percent thereafter. Depreciation for the asset has been calculated at 5.28 percent annually for the first 12 years, with the remaining value spread across the total project life of 25 years.

GSECL has also executed a long-term Power Purchase Agreement with Gujarat Urja Vikas Nigam Limited (GUVNL) for a period of 25 years. Based on the project cost, financial parameters, and the 50 percent government capital grant, the company has proposed a fixed levelized tariff of ₹2.76 per kWh for the electricity generated from the plant.

Through its petition, GSECL has requested GERC to admit the filing, approve the capital cost of the project, and determine the tariff accordingly. The company has also sought permission to bill the energy supplied from the project starting from its commercial operation date.