GERC Defers INR 2.34/kWh Tariff For 1,250 MW Solar Procurement Over Grid Stability Concerns In Gujarat

The Gujarat Electricity Regulatory Commission (GERC) has deferred the adoption of a tariff of ₹2.34 per unit discovered for 1,250 MW of solar power procured by Gujarat Urja Vikas Nigam Limited (GUVNL). The Commission raised concerns over renewable energy curtailment, grid stability, energy storage and the overall cost of integrating additional solar power into the grid.

The decision was issued through a daily order dated September 5, 2026, following a hearing held on September 2. The Commission bench comprised Chairman and Members.

GUVNL had approached GERC under Sections 63 and 86(1)(b) of the Electricity Act, 2003, seeking approval for the adoption of the tariff discovered through its Phase XXVIII competitive bidding process. The procurement covered 625 MW of base capacity and another 625 MW under the Greenshoe option.

The tender attracted 24 bids totaling 4,176.7 MW. Following an e-reverse auction conducted in March 2026, a tariff of ₹2.34/kWh was discovered for three successful developers.

NLC India Renewables Limited was awarded 300 MW of base capacity and 600 MW under the Greenshoe option, taking its total allocation to 900 MW. The company offered a CUF of 26%. Welspun Renewable Energy Private Limited received 300 MW of base capacity at the same tariff, with an offered CUF of 28.9%, but declined the Greenshoe option. Meghmani Renew Energy Private Limited was awarded 25 MW of base capacity and 25 MW under the Greenshoe option, totaling 50 MW, with a CUF of 24.5%.

GUVNL argued that the tariff was lower than rates discovered in earlier solar procurement rounds. It also said the procurement would support Gujarat in meeting its Renewable Purchase Obligations through FY 2029–30 and contribute to India’s target of achieving 50% non-fossil fuel-based installed capacity by 2030.

However, GERC has sought further information before approving the tariff. The Commission issued a 13-point query covering renewable energy curtailment, grid management, storage requirements, resource adequacy and the actual cost of solar power.

GERC has asked GUVNL to provide daily renewable energy curtailment data from September 1, 2025, to August 31, 2026, along with a time-bound plan to address the issue. It also questioned whether procuring standalone solar power without storage or Firm and Dispatchable Renewable Energy components would create additional challenges for grid stability.

The Commission further directed GUVNL to demonstrate that the procurement is consistent with updated Resource Adequacy plans and to calculate the overall cost after considering storage, balancing and backing-down requirements.

GUVNL sought three weeks to submit technical studies, curtailment data and supporting documents. GERC has allowed the request and directed the utility to submit its additional response by September 23, 2026. The next hearing will be scheduled after the submission.