BERC Announces Renewable Energy Tariffs For FY 2026–27 Across Biomass And Waste-To-Energy Projects In Bihar

The Bihar Electricity Regulatory Commission (BERC) has issued a suo-motu order determining the generic levellised tariff for electricity generated from renewable energy sources for the financial year 2026–27. The order, issued under BERC Case No. SMP 21/2026, will be applicable retrospectively from April 1, 2026, to March 31, 2027. The tariffs will remain valid for renewable energy projects commissioned during this period and will continue throughout the applicable tariff period of 20 to 25 years, depending on the technology.

The tariff determination has been carried out under the provisions of the BERC Renewable Energy Tariff Regulations, 2025. These regulations introduced a three-year control period covering FY 2025–26 to FY 2027–28. As part of the process, BERC issued a public notice inviting comments and suggestions from various stakeholders, including state distribution companies South Bihar Power Distribution Company Limited (SBPDCL), North Bihar Power Distribution Company Limited (NBPDCL), Bihar Renewable Energy Development Agency (BREDA), and Bihar Sugar Mills Association (BSMA).

During the consultation process, the state DISCOMs highlighted concerns related to higher normative capital costs and fluctuations in fuel prices. They requested changes in working capital fuel stock norms and sought clear mechanisms for fuel cost adjustments to minimize financial risks. However, BERC rejected these suggestions, stating that any changes to basic normative parameters would require amendments to the broader renewable energy regulations rather than the annual tariff order.

The Commission accepted the submission made by the Bihar Sugar Mills Association regarding the effective date of the tariff order. BERC agreed to apply the revised tariff retrospectively from April 1, 2026, ensuring continuity with the previous regulatory cycle.

For tariff calculations, BERC adopted key financial assumptions, including a normative debt-equity ratio of 70:30 and a post-tax discount rate of 9.11%. The interest rate on debt was fixed at 10.716%, based on the State Bank of India’s average MCLR plus 200 basis points. The return on equity was maintained at 14%. Additionally, operation and maintenance expenses were increased by 3.84% compared to the previous year’s norms.

The Commission announced separate tariffs for different renewable energy technologies. Biomass gasifier projects received a tariff of ₹9.92 per kWh without Accelerated Depreciation (AD) benefits and ₹9.78 per kWh with AD benefits. The tariff includes a fixed cost component of ₹3.49 per kWh and fuel cost of ₹6.43 per kWh.

For non-fossil fuel cogeneration projects using bagasse, BERC approved a tariff of ₹8.15 per kWh without AD and ₹7.97 per kWh with AD, based on a bagasse fuel price of ₹2,957.96 per tonne. Non-bagasse cogeneration projects received tariffs of ₹8.88 per kWh without AD and ₹8.70 per kWh with AD.

Municipal Solid Waste (MSW) Rankine Cycle projects were assigned tariffs of ₹7.07 per kWh without AD and ₹6.58 per kWh with AD, while Refuse Derived Fuel (RDF) projects received ₹9.75 per kWh without AD and ₹9.48 per kWh with AD.

Biomass power projects using Rankine Cycle technology were approved tariffs ranging from ₹9.98 per kWh to ₹10.62 per kWh, depending on boiler technology, cooling systems, and fuel type. BERC also clarified that project-specific tariff mechanisms will continue for solar PV, solar thermal, energy storage, and hybrid renewable energy projects.