The Kerala State Electricity Regulatory Commission (KSERC) has partially approved the Kerala State Electricity Board Limited’s (KSEBL) proposal for short-term power procurement through the Ministry of Power’s DEEP portal. The procurement was proposed to address power shortages caused by weak southwest monsoon conditions, low hydro reservoir levels, increasing electricity demand and the impact of El Niño conditions.
KSEBL had initially sought approval to procure 835.50 million units (MU) of electricity between September 1, 2026, and May 15, 2027. The proposed procurement involved an estimated financial commitment of Rs 742.52 crore and covered round-the-clock (RTC), off-peak night and peak-hour power.
For meeting the requirement, KSEBL conducted online bidding and negotiations with several power traders, including NTPC Vidyut Vyapar Nigam Limited, PTC India Limited, Tata Power Trading, RPG Power Trading and Shree Cement Limited.
After examining KSEBL’s Load Generation Balance and considering submissions made during a public hearing on September 2, 2026, KSERC rejected the proposed procurement of both off-peak night and RTC power.
According to the Commission, KSEBL can manage off-peak night demand through its existing contracted power capacity and available local hydropower resources. The Commission also found RTC procurement at the proposed high rates unsuitable. It noted that the rapid growth of rooftop solar capacity in Kerala has contributed to surplus electricity availability during daytime hours, reducing the need for additional RTC contracts.
KSERC instead approved power procurement only for peak hours from October 2026 until May 15, 2027. KSEBL has been permitted to procure 346.42 MU at the CTU periphery at an average tariff of Rs 10.04 per unit. The approved procurement carries a total financial commitment of Rs 347.79 crore.
The Commission stated that the approval is a temporary arrangement intended to prevent disruption in electricity supply during periods of critical shortage. It clarified that the approval should not be treated as a precedent for future procurement of expensive power.
KSERC also highlighted the expected contribution of upcoming Battery Energy Storage System (BESS) projects, North-East monsoon inflows and improved winter power availability in strengthening Kerala’s electricity supply position.
The Commission directed KSEBL to strengthen Demand Side Management (DSM) measures to control rising peak demand. KSEBL has been asked to appoint a senior officer to lead DSM activities and conduct large-scale public awareness campaigns promoting energy conservation. These measures are expected to help reduce peak demand by at least 300 MW.
KSEBL has also been directed to explore power-banking arrangements with other state utilities and maximize hydropower generation during peak-demand periods. The utility must submit an updated power situation report and revised load balance by mid-December 2026.
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