Validity of Levelized Tariff for Solar Projects in Uttarakhand Extended

The extension was passed due to the unavailability of module price data amid the ongoing COVID-19 crisis


The Uttarakhand Electricity Regulatory Commission (UERC) has extended the validity of benchmark capital cost and levelized generic tariffs for solar projects to March 31, 2021.

The Commission had previously extended the validity of the benchmark capital cost and levelized generic tariffs for solar projects up to September 30, 2020, back in May 2020.

In its latest order, the UERC cited the state’s renewable energy regulations from 2018, which allows it to review and revise the benchmark capital costs and tariffs for solar and other renewable source-based projects annually.

It referred to the government’s decision to extend the nationwide lockdown with relaxations and explained that commercial activity in the deployment of solar projects might take some more time to get back to normal.

The Commission explained that generalized annual data for solar photovoltaic module prices are still unavailable in the midst of the ongoing Coronavirus crisis. Even though the lockdown is being slowly lifted in phases, the disruption to the supply chain of many goods has not returned to normal yet and will likely take more time, it added.

It said that determining benchmark capital costs and levelized tariffs without this data would adversely affect setting fair tariffs for solar projects. The UERC also noted that given the Government’s focus on its “Make in India” campaign, the prices or goods and products could be volatile in the initial period.

In conclusion, the Commission extended the applicability of the benchmark capital cost and levelized tariff for solar energy projects until March 31, 2021. It added that the other terms and conditions under the state’s renewable energy regulations, 2018, would be applicable without any changes.

In June 2019, the Commission determined the benchmark capital cost and tariff for solar, solar thermal power, grid-interactive rooftop, and small solar power projects commissioned between April 1, 2019, and March 31, 2020.

In May, the benchmark cost was set at ₹35.63 million (~$487,624)/MW for large-scale solar projects. The gross levelized tariff of ₹4.49 (~$0.061)/kWh for large-scale solar projects and accelerated depreciation (AD) of ₹0.24 (~$0.003)/kWh is for projects commissioned on or after April 1, 2019. These were set to serve as the upper tariff ceilings for solar procurement through auctions in the state of Uttarakhand. These tariffs and benchmark costs will be applicable until March 31, 2021.

Recently, Mercom reported that the hilly state had announced generic tariffs for rooftop and small solar projects under the Pradhan Mantri Kisan Urja Suraksha evam Utthan Mahabhiyan (PM-KUSUM) program with a subsidy rate of 80%.