MERC Approves 10 MW RTC Power Procurement At INR 5.40/kWh for One Year

The Maharashtra Electricity Regulatory Commission (MERC) has partly approved a power procurement proposal submitted by Maharashtra Industrial Township Limited (MITL), allowing the company to purchase 10 MW of Round-the-Clock (RTC) conventional power from Ideal Energy Projects Limited (IEPL). However, the Commission has restricted the approval to one year instead of the four-year period originally requested by MITL.

The order was issued on June 19, 2026, by a bench comprising Chairperson Valsa Nair Singh and Members Anand M. Limaye and Surendra J. Biyani. The approved tariff for the power supply is Rs 5.40 per kWh, and the arrangement will remain valid from May 1, 2026.

MITL had approached the Commission seeking approval for a medium-term Power Purchase Agreement (PPA) covering the period from April 1, 2026, to March 31, 2030. The company planned to use the power to meet the electricity requirements of the Shendra Industrial Area and the Bidkin Industrial Area, allocating 5 MW to each location.

The company informed the Commission that its earlier power supply agreement with Jhabua Power Limited had expired on February 28, 2026, resulting in a shortage of power. MITL also stated that a competitive bidding process conducted through the DEEP Portal had secured only 11 MW from another supplier, leaving a gap in its power requirement.

According to MITL, IEPL, which emerged as the second-lowest bidder in the bidding process, offered to supply the required 10 MW at Rs 5.40 per kWh, matching the lowest discovered tariff. The company argued that the proposed rate was competitive and lower than the ceiling tariffs specified by the Commission. It also stated that conducting a fresh tender for such a small capacity could increase costs and create risks to uninterrupted power supply for industries operating in the region.

Considering the urgency of the situation, MERC had earlier allowed power scheduling to begin through an interim arrangement. However, while reviewing the final petition, the Commission noted that the MERC Multi-Year Tariff Regulations, 2024, require future power procurement to be carried out through a transparent competitive bidding process.

The Commission observed that procuring power through a negotiated arrangement based on a tariff discovered in another bidding process does not fully comply with regulatory requirements. While acknowledging the immediate need for power after the expiry of the previous contract, MERC concluded that such circumstances did not justify bypassing competitive bidding for four years.

As a result, the Commission approved the procurement only for one year and directed MITL to immediately start a fresh competitive bidding process to meet its long-term power requirements in compliance with the Electricity Act and regulatory guidelines.