UERC Rejects UJVN’s BESS Tariff Review Plea, Clarifies VGF Project Exemption In Uttarakhand

The Uttarakhand Electricity Regulatory Commission (UERC) has rejected a review petition filed by UJVN Limited seeking an increase in the benchmark ceiling tariff for Battery Energy Storage System (BESS) projects. However, the regulator clarified that the reduced benchmark tariff will not apply to standalone BESS projects being developed under the Central Government’s Viability Gap Funding (VGF) scheme through tariff-based competitive bidding.

The review petition was filed against UERC’s June 4, 2026 order, which revised the BESS capacity charge benchmark for the financial year 2026-27. The commission had reduced the ceiling tariff from Rs. 3,96,747 per MW per month to Rs. 2,59,244 per MW per month.

UJVN Limited argued that the tariff reduction could affect its ongoing procurement process. The company had already started competitive bidding in February 2026 for four BESS projects with a combined capacity of 76 MW/192.5 MWh based on the earlier benchmark tariff approved in January 2026.

The power generator said that changing the tariff benchmark during the tender process could create uncertainty among bidders, discourage participation, disturb the timeline linked with Viability Gap Funding, and impact the financial feasibility of the projects. Uttarakhand Power Corporation Limited (UPCL) also supported the petition, highlighting concerns about possible difficulties in implementing ongoing procurement activities.

After examining the matter, the UERC bench, comprising Chairman M.L. Prasad, Member (Law) Anurag Sharma, and Member (Technical) Prabhat Kishor Dimri, rejected the review request. The commission stated that the petition did not meet the requirements for review under Section 94(1)(f) of the Electricity Act, 2003, along with Order XLVII Rule 1 of the Code of Civil Procedure, 1908.

The regulator observed that a review petition cannot be used as a way to appeal against an earlier decision or reopen arguments that have already been considered. According to UERC, issues related to financial assumptions, project costs, and sector-specific considerations were already examined while issuing the original tariff order.

The commission also rejected UJVN’s argument regarding new evidence. It noted that changes in international battery prices, market conditions, or tariff outcomes from tenders conducted in other states cannot be considered the discovery of new evidence that would justify a review of the tariff order.

At the same time, UERC issued an important clarification regarding the applicability of the revised benchmark tariff. The commission stated that the new benchmark charge of Rs. 2,59,244 per MW per month will apply only to standard BESS projects developed under Uttarakhand’s Renewable Energy Regulations, 2023.

Standalone BESS projects developed under the Central Government’s VGF scheme through tariff-based competitive bidding will remain outside the scope of this benchmark ceiling. The commission explained that storage projects differ based on location, duration, and operational requirements, and therefore tariffs discovered through competitive bidding will be assessed separately.

UERC directed UJVN Limited to continue with its ongoing tender process and submit the final discovered tariffs for approval under Section 63 of the Electricity Act. The clarification is expected to remove uncertainty for ongoing energy storage projects in Uttarakhand and allow competitive bidding activities to proceed without being restricted by the state’s general benchmark tariff.