The Uttar Pradesh Electricity Regulatory Commission (UPERC) has approved a power purchase agreement (PPA) entered into by a developer with Uttar Pradesh Power Corporation (UPPCL) for a 5 MW concentrated solar power pilot project in Unnao with a tariff of ₹4.73 (~$0.05)/kWh.

The Commission cited the project’s ability to supply firm renewable power during peak hours and support Uttar Pradesh’s rising renewable purchase obligations.

Background

In November 2024, Cosmicwave approached the Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA) to set up a pilot 5 MW concentrated solar project in Unnao under the Uttar Pradesh Solar Power Policy, 2022.

In May 2025, UPNEDA informed UPPCL about the proposed concentrated solar project and asked it to take necessary action.

Later that month, Cosmicwave shared key project details with UPPCL, including the 5 MW capacity, a proposed tariff of ₹4.73 (~$0.05)/kWh, and daily supply of up to 40 MWh during peak hours.

In July 2025, UPPCL held a meeting with Cosmicwave to discuss the commercial and technical aspects of the proposed project. The company stated that the tariff would remain fixed unless molten salt prices rose unexpectedly and would be reviewed every five years.

UPPCL gave in-principle consent in August 2025 to procure power from the proposed project, subject to UPERC’s approval or tariff determination.

UPPCL’s average power purchase cost for renewable energy was ₹3.62 (~$0.038)/kWh. Cosmicwave proposed a purchase tariff of ₹4.73 (~$0.05)/kWh for the project.

Cosmicwave approached UPERC to seek approval for its PPA and the tariff.

It submitted that concentrated solar projects use mirrors or lenses to concentrate sunlight, heat molten salt, generate steam, and run a turbine. It said this gives concentrated solar a different cost structure, higher capital expenditure, and more complex equipment requirements than conventional solar projects.

The company said the proposed tariff was necessary for the project’s viability because of higher PPA costs. It also submitted that India did not have comparable projects to establish market-based pricing.

Cosmicwave said the concentrated solar project with thermal energy storage can supply power after sunset and ramp generation up or down based on demand. It submitted that the project could supply up to 40 MWh per day, primarily during peak hours, helping UPPCL meet peak demand with renewable energy.

It contended that competitive bidding would not be suitable because India’s concentrated solar market is not mature. It said the technology had not achieved economies of scale comparable to conventional solar projects and that bidding might not attract sufficient participation to determine a fair, competitive tariff.

The company further submitted that some major components, including heliostats, zinc-bromine flow batteries, and molten salt receivers, may need to be imported because they were not available in India’s domestic market. Other components would be procured domestically.

In its reply, UPPCL informed the Commission that, as of November 2025, solar accounted for 2,937 MW, or 8.2%, of its total contracted capacity of 35,995 MW. It said it would need to purchase power from Cosmicwave’s project to meet its rising renewable purchase and consumption obligations.

UPPCL added that Uttar Pradesh would face a growing round-the-clock power deficit from the financial year (FY) 2030, rising from 885 MW in that year to over 29,000 MW by FY 2040. It said this demonstrated the need to add firm, dispatchable capacity.

It said evening peak market power rates in FY 2025 ranged from ₹6 (~$0.063)/kWh to ₹7.5 (~$0.078)/kWh, including day-ahead and real-time market rates, transmission charges, and losses. Against this, Cosmicwave’s proposed tariff of ₹4.73 (~$0.05)/kWh could save UPPCL about ₹2 (~$0.021)/kWh.

UPPCL confirmed that it had given in-principle approval to Cosmicwave for the PPA.

Commission’s Analysis

The Commission noted that concentrated solar power with molten salt thermal storage would provide firm, scheduled power, unlike conventional solar projects. It said the project was similar to a coal-based thermal plant in terms of firm scheduling.

UPERC observed that a project combining renewable energy with firm supply was needed for sustainable development and that supporting such a pilot project could help integrate clean power into the grid. It also noted that the project’s success could encourage similar projects across India.

The Commission held that the proposed ₹4.73 (~$0.05)/kWh tariff would be economical compared with power exchange prices, energy storage systems, and new coal-based power plants.

It approved the PPA between Cosmicwave and UPPCL and directed the latter to submit the executed agreement.

Recently, UPERC adopted tariffs of ₹2.98 (~$0.0313)/kWh and ₹2.99 (~$0.0314)/kWh for the procurement of 165.5 MW of solar power under the PM KUSUM Component-C2 program.

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