Maharashtra Commission Allows Modifications in PPAs and PSAs for 252 MW of Solar Projects

The petition has been filed to allow modifications in the Change in Law clause, scheduled commercial operation timelines, and deemed generation compensation clause

September 16, 2019


The Maharashtra Electricity Regulatory Commission (MERC) has approved the requests of a petition filed by the Maharashtra State Power Generation Corporation Limited’s (MSPGCL) for two solar power projects of 150 MW and 102 MW capacity.

In its petition, the MSPGCL had requested the MERC to allow modifications in the agreed power purchase agreements (PPAs) and power sale agreements (PSAs) for the two projects. Further, MSPGCL had also requested changes concerning deemed generation compensation as well.

Approval of the proposed modification in “Change in Law” of approved PSA

 According to the submissions of the MSPGCL, there was a major deviation in the “Change in Law” clause stipulated in the approved draft PSA and provided in the request for proposal (RfP), which was raised by the bidders while submitting their bids.

Therefore, according to MSPCGL, it would be more appropriate that the PSA clause is modified in line with the clause in the Ministry of Power (MoP) guidelines as well as the RfP. Further, MSPGCL also requested to increase the timeline for the scheduled commercial operation (SCOD) date to 18 months from 13 months in the PSA for both the projects.

The MERC allowed the modification in the change in law clause and the SCOD timelines for both the projects.

Approval of change in deemed generation clause and injection of 11 kV solar power

Bidders of the project had anticipated the evacuation of power at a voltage level of 33kV. However, the projects are now to be connected at 11kV/22kV bus-bar level of MSEDCL as there are issues regarding grid-availability at this voltage level and the loss of generation on account of such non-availability of the grid.

MSPGCL also requested the MERC to approve the proposed deviation in the deemed generation compensation clause concerning the standard bidding guidelines and RfP and to allow MSPGCL and MSEDCL to incorporate the changes in the relevant clause in the PPA and PSA for the projects.

The MERC allowed the injection of power at 11kV for both the projects, but also mentioned that the deemed generation compensation be allowed in consultation with project developers.

Finally, the MERC ordered the concerned parties to amend the relevant documents for both 150 MW and 102 MW projects and then submit them to the commission.

Recently, the state commission had also approved the signing of power purchase agreements by the MSEDCL. The MERC was listening to a petition filed by the MSEDCL seeking the approval for the adoption of tariff for long term procurement of 1,000 MW of solar power under Section 63 of the Electricity Act (EA), 2003 for meeting the solar renewable purchase obligations.

In July 2019, the MERC reiterated that solar safeguard duties be considered as a change in law.