UP Regulatory Commission Clears Regulatory Path For 20 MW Floating Solar Project In Gorakhpur

The Uttar Pradesh Electricity Regulatory Commission (UPERC) has granted regulatory relaxation for the development of a 20 MW floating solar photovoltaic (PV) power plant at Chilwa Tal in Gorakhpur. The decision came in response to a joint petition filed by the U.P. New & Renewable Energy Development Agency (UPNEDA) and Uttar Pradesh Power Corporation Ltd. (UPPCL), seeking exemption from mandatory competitive bidding requirements for procuring power from Coal India Limited (CIL) on a cost-plus basis.

The Commission, comprising Chairman Arvind Kumar and Member Sanjay Kumar Singh, used its “Power to Relax” provisions under the UPERC CRE Regulations, 2024, and the Modalities of Tariff Determination Regulations, 2023. While reviewing the proposal, the Commission considered its broader objective, legitimacy, and the availability of alternative options.

UPERC observed that the project supports the objectives of the state’s Solar Energy Policy-2022, which aims to develop Gorakhpur as a model Solar City. The policy targets a 10% reduction in conventional energy consumption through renewable energy sources within five years.

Coal India Limited, a Central Public Sector Enterprise, was nominated by the Uttar Pradesh government to execute the project. Once commissioned, the floating solar plant is expected to generate around 38.56 million units of electricity annually, contributing about 3.24% of Gorakhpur’s projected power demand during FY 2026-27.

The Commission also noted the challenges involved in securing an 80-acre water body within city limits. It acknowledged that attracting private developers through competitive bidding would be difficult. Additionally, a significant portion of the required land is being provided either free of cost or under favorable terms by government agencies and public institutions, reducing project costs considerably.

During the hearing, CIL indicated a tentative tariff of around ₹3.50 per kWh, which is higher than typical ground-mounted solar tariffs. However, the company stated that efforts are underway to reduce financing costs and lower the final tariff.

UPERC concluded that tariff determination under Section 62 of the Electricity Act, 2003, is the most suitable approach for this project. The final tariff will be decided by the Central Electricity Regulatory Commission (CERC), after which UPPCL can sign the Power Purchase Agreement with CIL and seek final approval from UPERC.