KERC Asks DISCOMs to Stick to Competitive Bidding Guidelines for Wind Projects

Move comes as Karnataka seeks to attract greater investment in renewable project development

February 14, 2018


The Karnataka Electricity Regulatory Commission (KERC) has issued an order directing all distribution companies (DISCOMs) in the state to procure wind power according to the competitive bidding guidelines for wind projects in India issued by the Ministry of Power.

The KERC order is immediately applicable to every DISCOM in Karnataka, and the new benchmark tariff will apply through March 31, 2018.

This step by KERC comes a few months after it announced the revision of wind tariffs last year. In September 2017, KERC fixed ₹3.74 (~$0.058)/kWh as the generic tariff for wind projects in the state of Karnataka.

This latest announcement by KERC is set to pave the way for the smoother implementation of wind power projects across the state.

Mercom previously reported that wind auctions in Tamil Nadu and Gujarat were placed on hold after the Indian Wind Energy Association (IWEA) filed petitions asking for a stay on tendered capacity because there were no Ministry of New and Renewable Energy (MNRE) guidelines to base the auctions on.

The overwhelming number of participants in MNRE’s first two wind tenders has none-the-less prompted more states to go forward with their own wind tenders, creating the need for a universal set of guidelines.

The Ministry of Power guidelines aim to provide just that by creating a national framework for the cost-effective procurement of wind power using a transparent bidding process.

KERC’s decision to follow that framework demonstrates that the state is taking a practical approach to identifying problem areas in the renewable sector.

It also represents another step forward in Karnataka’s plans to become a model state for renewable energy investment. Mercom previously reported that KREDL is looking to attract more investors to develop renewable projects.

In January 2018, Mercom also reported on KERC’s release of a discussion paper that called for increasing the wheeling and banking charges for solar, wind, and other renewable energy projects developed under a non-REC route in Karnataka. KERC said drastic reductions in the cost of wind and solar in recent years have made these renewable energy sources competitive with the conventional sources of energy and created a need to increase the applicable charges.

Karnataka has ~3 GW of large-scale solar installations and a project pipeline of around 1.4 GW, according to Mercom’s India Solar Project Tracker.

Earlier this month , Suzlon, a wind turbine manufacturer and renewable energy project developer, bagged a repeat order of 96.6 MW from renewable energy project developer ReNew Power for the development of a wind project in Karnataka.

Image credit: Flickr