Maharashtra’s Draft Policy Sets Solar RPO Target at 4.5% for 2020-21

The RPO goes up to 13.5% over the next five years

October 30, 2019


The Maharashtra Electricity Regulatory Commission (MERC) has issued a draft policy announcing its renewable purchase obligation (RPO) from 2020 to 2025.

The solar RPO targets mentioned in the policy draft will start at 4.5%, going up to 13.5% over the next five years.

Maharashtra - Renewable Purchase Obligation Target

According to the document, an obligated entity can use surplus solar energy up to 15% of the total RPO targets to meet the shortfall in its non-solar target and vice versa. Obligated entities can also aim at achieving the total RPO targets notified by the central government, and for doing that, there is an incentive of ₹0.25/kWh ($0.0035).

Distribution companies will be subjected to a reduction in the annual revenue requirement at a rate of ₹0.10 ($0.0014)/kWh for the shortfall in the total renewable power procurement target for each year. Further, other obligated entities will be subjected to a penalty of ₹0.10/kWh for the shortfall in the total renewable procurement target for each year.

These regulations are expected to come into force from the date of their publication in the state’s official gazette.

Assam also recently issued a draft RPO policy with a much more aggressive solar RPO rates starting from 7.25% in 2019-20 and increasing to 10.5% in 2021-2022.

Earlier, the MERC has approved the Maharashtra DISCOM’s request to procure an additional 300 MW capacity of solar power from the Energy Efficiency Services Limited (EESL).

Before this, Maharashtra had floated a tender for the long-term procurement of 1 GW of solar power to meet its RPO in June 2019. The ceiling tariff for that tender was set at ₹2.80 ($0.038)/kWh.

According to Mercom Solar Project Tracker, Maharashtra has 1.4 GW of cumulative large-scale solar installed capacity as of Q2 2019. A total of 1,087 MW of solar projects are under development in the state.

Image credit: Goodwe