Power Sale Agreement Between SECI and Tata Power for 300 MW of Solar Gets Approval

DERC refuses to approve tariff for PSA


The Delhi Electricity Regulatory Commission (DERC) has approved a power sale agreement (PSA) between the Solar Energy Corporation of India (SECI) and Tata Power Delhi Distribution Limited (TPDDL) for procuring power from 300 MW of solar photovoltaic (PV) projects. The procurement is towards meeting TPDDL’s renewable purchase obligation.

TPDDL had petitioned the DERC to adopt a tariff of ₹2.54 (~$0.036)/kWh plus the trading margin of ₹0.07 (~$0.0010)/kWh for 100 MW solar power under Section 63 of the Electricity Act, 2003 until the commissioning of total SECI-interstate transmission system (ISTS) solar PV project, after which the tariff would be ₹2.572 (~$0.037)/kWh (including trading margin) for the remaining duration of power purchase agreement (PPA).

While examining the petition and submissions made, the DERC observed that SECI was designated as the nodal agency responsible for conducting the bidding process and it has followed the guidelines issued by Ministry of New and Renewable Energy (MNRE) to set up grid-connected solar PV projects.

The DERC also pointed that as the generation and sale of power will take place in more than one state, the jurisdiction to determine the tariff lies with the Central Electricity Regulatory Commission (CERC) under section 79(1) (b) of the Electricity Act, 2003.

The commission stated that it could not determine the tariff for procuring solar power from SECI implemented project. TPDDL must approach the CERC instead.

The DERC asked the parties to modify the terms and conditions of the PSA. It has asked the petitioner to include a clause that the buying entity will pay maximum possible fixed tariff as adopted by the concerned regulatory commission (CERC) plus a trading margin of ₹0.07 (~$0.0010)/kWh fixed up to commissioning of the cumulative awarded capacity/accepted cumulative capacity by SECI under the RfS.

The Delhi Commission has also asked the petitioner to include a provision stating that weighted average tariff as approved by CERC plus a trading margin of ₹0.07 (~$0.0010)/kWh fixed will be applicable. The tariff will be applicable upon commissioning of the cumulative awarded capacity/accepted cumulative capacity by SECI under RfS for the balance term of this agreement for the energy supplied as per provisions of this agreement.

DERC has ordered TPDDL to file a copy of the modified PSA within a month. Recently, DERC issued a similar order approving PSA with modification but refusing to approve tariff for procurement of 20 MW solar PV by TPDDL from SECI.

In January 2019, DERC approved two PSAs between BSES Rajdhani Power Limited (BRPL) and PTC India Ltd for the procurement of 100 MW of wind power.