CERC Approves Tariffs For 1500 MW ISTS Solar Projects Led By NTPC

The Central Electricity Regulatory Commission (CERC) has approved tariffs for 1500 MW of solar power projects in a move that will support India’s growing renewable energy capacity. These projects are connected to the Inter-State Transmission System (ISTS) and were awarded through a competitive bidding process conducted by NTPC Limited. The initiative is part of the government’s broader effort to meet Renewable Purchase Obligations (RPO) and increase the share of clean energy in the country’s power mix.

The bidding process began in February 2024 and followed a transparent e-reverse auction method. After detailed technical and commercial evaluations, five companies qualified for the final stage. These included Avaada Energy, JSW Neo Energy, ReNew Solar Power, Apraava Energy, and Illuminate Hybren. Together, they offered a total capacity of 2100 MW, which was higher than the required 1500 MW. This higher participation helped create strong competition and better price discovery.

At the end of the auction, tariffs were discovered in a narrow range of INR 2.68 per kWh to INR 2.69 per kWh. Apraava Energy secured 50 MW at the lowest tariff of INR 2.68 per kWh. The remaining capacity was shared among other bidders. Avaada Energy was awarded 750 MW, ReNew Solar Power received 300 MW, and JSW Neo Energy secured 400 MW, all at a tariff of INR 2.69 per kWh. These tariffs will remain fixed for a period of 25 years under the Power Purchase Agreements (PPAs), providing long-term price certainty.

During the review process, the Commission raised some concerns about the tariffs. It noted that some recent solar tenders in India had discovered slightly lower rates, going down to around INR 2.56 per kWh. The Commission asked whether the current tariffs were on the higher side compared to these benchmarks.

In response, NTPC explained that the discovered tariffs were reasonable and reflected current market conditions. The company pointed out that several recent tenders had reported similar price levels. It also highlighted that the bidding process followed all guidelines issued by the Ministry of Power. The Bid Evaluation Committee supported this view and confirmed that the auction was conducted in a fair and transparent manner, and that the tariffs were justified.

Under the project structure, NTPC will act as an intermediary procurer. It will sign Power Purchase Agreements with the selected developers and then enter into Power Sale Agreements with distribution companies and other utilities. This arrangement helps ensure that the generated solar power is supplied efficiently to the grid while supporting distribution companies in meeting their renewable energy targets.

In its final order, the Commission approved the tariffs under Section 63 of the Electricity Act, 2003. It stated that the entire bidding process was transparent and met all regulatory requirements. With this approval, the next steps will include signing formal agreements and starting project development activities.

This decision is expected to strengthen India’s renewable energy sector and support the country’s long-term clean energy goals.