The Gujarat Electricity Regulatory Commission (GERC) has issued an important order supporting Dakshin Gujarat Vij Company Limited (DGVCL) on the adoption of solar power tariffs under a key government scheme. The decision, related to Petition No. 2603 of 2026, is a major step in implementing Component-A of the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) scheme in southern Gujarat.
The main issue in the petition was DGVCL’s request to approve a tariff of ₹2.95 per unit as the ceiling rate for buying electricity from decentralized, grid-connected solar power plants. This proposal was based on an earlier order issued by the Commission in May 2025, which had already set this benchmark tariff for projects under the PM-KUSUM scheme.
Component-A of the scheme focuses on helping farmers, cooperatives, and farmer-producer organizations to set up small solar plants ranging from 500 kW to 2 MW on their own land. The idea is to give farmers an additional and stable source of income while also increasing clean energy generation in the country.
DGVCL followed a structured and transparent bidding process for project allocation. The company invited applications for setting up solar plants across different substations. In cases where the total capacity requested by applicants was equal to or less than the available capacity, projects were directly awarded at the fixed tariff of ₹2.95 per unit. For example, at the 66 kV Zankhvav substation, two farmers were allotted a total capacity of 4.00 MW at this pre-decided rate.
However, the situation was different at the 66 kV Moti Falod substation, where demand exceeded the available capacity. The total capacity requested by developers was 4.00 MW, while only 2.58 MW was available. To ensure fairness, DGVCL conducted an e-reverse auction on December 9, 2025. This competitive process helped discover lower tariffs than the ceiling rate.
Two companies emerged as successful bidders in this auction. Raycal Power Infra Private Limited quoted the lowest tariff of ₹2.77 per unit, while Rayzon Solar Limited followed closely with a tariff of ₹2.78 per unit. These rates are lower than the initially proposed ceiling tariff, showing the benefit of competitive bidding.
The Commission approved these discovered tariffs under Section 63 of the Electricity Act 2003, which allows tariffs to be adopted if they are determined through a transparent and competitive process. The order also highlighted the importance of signing Power Purchase Agreements (PPAs) on time. This is necessary for developers to qualify for Performance Based Incentives offered by the Ministry of New and Renewable Energy.
With this approval, DGVCL can now proceed with signing agreements with the selected developers. The decision will help the state meet its renewable energy targets while also supporting farmers by creating new income opportunities through solar power generation.
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