Kerala State Electricity Regulatory Commission Ratifies KSEBL’s 125 MW Power Banking Deal With Uttar Pradesh Power Corporation Limited

The Kerala State Electricity Regulatory Commission (KSERC) has granted post-facto approval and ratification to the Kerala State Electricity Board Ltd (KSEBL) for a short-term power banking arrangement with Uttar Pradesh Power Corporation Limited (UPPCL). The Commission issued the order on September 3, 2026, allowing KSEBL to regularise the arrangement undertaken to address electricity shortages during peak evening hours in February 2026.

Under the arrangement, KSEBL procured 125 MW of power during the evening peak period from 18:00 to 22:00 hours throughout February 2026. The total energy received under the arrangement was 14.00 Million Units (MU). The transaction was facilitated through power trader Arunachal Pradesh Power Corporation Pvt. Ltd. (APPCPL).

In return for the power received during the peak-demand period, KSEBL agreed to return 103% of the banked energy to UPPCL during the monsoon season. The return power was scheduled between July 1 and August 31, 2026, during five off-peak night hours each day, covering 00:00 to 03:00 hours and 22:00 to 24:00 hours. The average return power was fixed at 46.52 MW.

KSERC also approved a trading margin of 1.5 paise per unit for APPCPL in connection with the transaction.

The arrangement was initiated following a decision of KSEBL’s Core Committee on Power Purchase in December 2025. KSEBL subsequently issued a provisional Letter of Award on January 29, 2026. The decision was later ratified by KSEBL’s Full Time Directors in February 2026.

Since short-term energy banking transactions require regulatory approval under Regulation 78 of the KSERC Tariff Regulations, 2021, KSEBL approached the Commission on May 14, 2026. The utility requested post-facto approval and condonation of the procedural delay, stating that the arrangement was necessary in the public interest to manage the power shortage.

The Commission examined the transaction under the Electricity Act, 2003, and Regulation 78(3)(vi) of the KSERC Tariff Regulations, 2021. The regulation permits energy banking arrangements to address short-term power supply deficits.

KSERC observed that the arrangement was beneficial for KSEBL and consumers as it reduced the need for direct cash payments for additional peak power. Instead, surplus energy available during the monsoon off-peak period could be used to settle the energy received during the winter peak-demand period.

Based on its assessment, the Commission found the arrangement justified and beneficial to consumers. KSERC therefore granted post-facto approval and formally ratified the power banking transaction, disposing of Petition OP No. 24/2026.