The Gujarat Electricity Regulatory Commission (GERC) has approved Gujarat Urja Vikas Nigam’s (GUVNL) petition to adopt tariffs for 500 MW of wind power capacity. The procurement includes 250 MW of base capacity and an additional 250 MW under the greenshoe option.

The tariffs were discovered through competitive bidding.

In the auction conducted by GUVNL, Patel Infrastructure secured 200 MW at an aggregate tariff of ₹3.43 (~$0.0358)/kWh. Alfanar Power secured 100 MW at ₹3.43 (~$0.0358)/kWh. KP Energy secured 100 MW at an aggregate tariff of ₹3.435 (~$0.0358)/kWh, and Powerica secured 100 MW at ₹3.435 (~$0.0358)/kWh.

The Commission permitted GUVNL to execute power purchase agreements with the successful bidders for the capacities and tariffs approved in the order.

Background

GUVNL filed the petition seeking tariff adoption for procuring wind power through competitive bidding for grid-connected wind projects.

The utility procures power on behalf of Gujarat’s four distribution companies, Uttar Gujarat Vij Company, Madhya Gujarat Vij Company, Dakshin Gujarat Vij Company, and Paschim Gujarat Vij Company, to meet renewable purchase obligations under GERC’s renewable energy regulations.

GUVNL submitted that the Ministry of Power had notified guidelines for tariff-based competitive bidding for wind power projects on July 26, 2023, and issued amendments on February 2, 2024.

Since the standard bidding documents had not been notified, GUVNL conducted the bidding process using documents aligned with the guidelines and deviations approved by the Gujarat government.

GUVNL stated that it had already tied up 2,683 MW of wind capacity through earlier competitive bidding exercises. Gujarat’s installed wind capacity had reached 5,032 MW as of March 31, 2026, including preferential tariff projects, Renewable Energy Certificate mechanism projects, and competitively bid projects.

The utility said additional wind procurement was needed to meet rising wind renewable purchase obligation (RPO) requirements.

According to the RPO trajectory cited in the order, wind RPO is expected to increase from 0.67% in the financial year (FY) 2025 to 3.48% in FY 2030. Total renewable energy obligations are projected to rise from 29.91% to 43.33% during the same period.

GUVNL stated that renewable energy tariffs under long-term power purchase agreements remain fixed for 25 years, while thermal tariffs continue to rise, making renewable procurement commercially beneficial for distribution companies and consumers.

The tender was issued to procure 250 MW of wind power capacity, with a greenshoe option for an additional 250 MW, from projects located anywhere in India.

The tender received seven bids which were scrutinized by the Bid Evaluation Committee.

Commission’s Analysis

The Commission accepted the tender provision allowing bidders within the L1 tariff plus 2% to qualify as successful bidders. GUVNL subsequently exercised the greenshoe option by offering additional capacity equal to the base allocation at the L1 tariff of ₹3.43 (~$0.036)/kWh.

Patel Infrastructure accepted an additional 100 MW. Alfanar Power, KP Energy, and Powerica each accepted an additional 50 MW. KP Energy also filed an affidavit confirming acceptance of the tariff for its full 100 MW allocation.

The Commission compared the discovered tariffs with recent market benchmarks. GUVNL submitted that SJVN’s March 2026 wind tender discovered tariffs ranging from ₹3.64 (~$0.038)/kWh to ₹3.65 (~$0.038)/kWh. The Solar Energy Corporation of India’s February 2026 Tranche XIX tender discovered tariffs ranging from ₹3.67 (~$0.038)/kWh to ₹3.69 (~$0.038)/kWh. GUVNL’s Phase IX tender discovered tariffs ranging from ₹3.64 (~$0.038)/kWh to ₹3.66 (~$0.038)/kWh.

Against these benchmarks, the Phase X tariffs of ₹3.43 (~$0.036)/kWh to ₹3.44 (~$0.036)/kWh were considered competitive.

Earlier this year, the GERC extended the applicability of the ₹1.50 (~$0.0159)/kWh banking charge under the state’s green energy open access framework until June 30, 2026.

Subscribe to Mercom’s real-time Regulatory Updates to ensure you don’t miss any critical updates from the renewable industry.