The Central Electricity Regulatory Commission (CERC) has approved tariffs of ₹5.06 (~$0.0567)/kWh and ₹5.07 (~$0.0568)/kWh for 420 MW of Solar Energy Corporation of India’s (SECI) 1,200 MW renewable energy projects with an energy storage system (ESS).

The Commission also approved a trading margin of ₹0.07 (~$0.0008)/kWh, subject to a cap of ₹0.02 (~$0.0002)/kWh if SECI did not provide escrow or line-of-credit payment security.

Background

The petitioner, SECI, issued a request for selection for the setting up of 1,200 MW round-the-clock, interstate transmission system-connected renewable energy projects with ESS.

SECI issued a letter of award to four bidders for a total capacity of 420 MW, with discovered tariffs of ₹5.06 (~$0.0567)/kWh and ₹5.07 (~$0.0568)/kWh.

The petitioner approached the Commission to approve the discovered tariffs and the trading margin of ₹0.07 (~$0.0008)/kWh.

The petitioner contended that the tariffs were selected through a transparent and competitive process.

It referred to a lower tariff range of ₹4.82 (~$0.054)/kWh to ₹4.91 (~$0.055)/kWh discovered for an earlier SJVN tender, stating that the performance criteria for it were less stringent.

SECI submitted that the tender’s power-delivery requirements led to higher costs for storage, balancing, and reliability, which, in turn, impacted the tariffs.

Commission’s Analysis

The Commission, while approving the discovered tariffs, acknowledged that the bidding process was transparent.

CERC also approved the requested trading margin, stating that it would be capped at ₹0.02 (~$0.0002)/kWh if the petitioner does not provide escrow or line-of-credit payment security.

It also directed the petitioner to place the power purchase and power sale agreements on record once it ties up the awarded capacity. The petitioner must inform the Commission if the capacity is not tied up.

In October this year, CERC approved a tariff of ₹2.5 (~$0.028)/kWh for SECI’s 100 MW solar project.

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