Maharashtra Proposes ₹3.30/kWh as Generic Tariff for Rooftop Solar Projects

Stakeholders can submit suggestions and objections by September 24, 2024

thumbnail

The Maharashtra Electricity Regulatory Commission (MERC) has proposed a generic tariff for rooftop solar projects and variable charges for existing biomass and non-fossil fuel-based co-generation power projects for the financial year (FY) 2024-25.

However, tariffs for other new renewable energy projects, as well as for repowering existing projects, will be determined only through competitive bidding as per the Renewable Energy Tariff Regulations, 2019. This applies to wind, solar, non-fossil fuel-based co-generation, biomass, and hybrid renewable energy projects.

Rooftop Solar

The draft order has notified a generic tariff of ₹3.30 (~$0.04)/kWh for the surplus power procured from rooftop solar under net-metering or net-billing arrangements.

The tariff has been benchmarked to MERC’s previous order, where it adopted the same tariff of ₹3.30 (~$0.04)/kWh.

The Commission said it had not adopted rates discovered in other states as they may have a subsidy component or other tariff benefits.

It also listed the Average Power Purchase Cost (APPC) for various distribution licensees, which will be applicable for rooftop solar projects opting for gross metering arrangements. The APPC rates for licensees range from ₹4.69 (~$0.06)/kWh to ₹6.89 (~$0.08)/kWh for 2024-25.

Biomass

For existing biomass power projects in the state, the draft order has proposed a variable charge of ₹6.23 (~$0.08)/kWh for FY 2024-25. This is applicable for projects that have already signed energy procurement agreements (EPAs) based on earlier generic tariffs set by MERC.

The biomass fuel price for the first year of the project will be based on the prevailing prices of the fuel mix and on an independent study conducted through The Energy and Resource Institute (TERI) to determine the fuel availability and prices in Maharashtra.

After the first year, fuel prices will be revised by MERC based on the price determined by the Central Electricity Regulatory Commission or an escalation factor based on an independent study, or 5% per annum, in line with an indexing mechanism specified by the Commission.

Non-Fossil Fuel-based Co-generation

The variable charge for non-fossil fuel-based co-generation projects has been proposed as ₹4.80 (~$0.06)/kWh for FY 2024-25. This is also applicable to existing projects with EPAs based on generic tariffs.

The price of bagasse for the first year will be based on the prevailing price as assessed through an independent study by MERC. After the first year, prices will be raised by 5% as per the indexing mechanism.

The variable charges for FY 2024-25 will come into effect from April 1, 2024.

The draft order has been issued for public consultation, and the final tariff order is expected to be announced after considering suggestions and objections from stakeholders.

Last year, MERC set a generic tariff of ₹3.05 (~$0.03)/kWh for distribution companies to procure surplus power from rooftop solar projects for FY 2023-24.

In November last year, MERC raised the net metering cap for rooftop solar projects to 5 MW from 1 MW.

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

RELATED POSTS