UP energy watchdog cuts solar power tariffs, clears bidding for 500 mw

Uttar Pradesh energy sector watchdog has cut solar power tariffs and allowed the state power utilities to procure 500 megawatt (Mw) of solar power through competitive bidding.

In its order, UP Electricity Regulatory Commission (UPERC) approved tariff and power purchase agreements for procuring 500 Mw of solar power by UP Power Corporation Limited (UPPCL) and the state power distribution companies (discoms).

The capacity of approved solar projects ranges between 20 Mw and 140 Mw, while the approved tariffs lie between Rs 3.17 per unit to Rs 3.23 per unit, which is the lowest power procurement price approved by the Commission for solar power projects in the state.

The order was passed yesterday by UPERC on the petition jointly filed by UPPCL and the state’s renewable energy nodal wing, UP New and Renewable Energy Development Agency (UPNEDA).

Earlier, the Commission had approved the bidding document and draft PPA allowing UPPCL to procure 500 Mw through the competitive bidding route.

While lower solar power tariffs would reduce the power purchase cost of discoms, they will also help UPPCL in meeting its Renewable Purchase Obligation (RPO) and UP in harnessing the potential of solar power going forward.

The Adityanath government is planning to build renewable energy capacity of 10,700 Mw in the near future. The state is also promoting roof-top solar power installations to encourage households to generate captive solar energy for consumption.

In fact, the state had even forwarded a proposal to the Centre for developing a Rs 4,000 crore Green Energy Corridor in the arid Bundelkhand region.

Last month, the Adityanath government cleared the proposal of renewable energy firms ReNew Power and Shapoorji Pallonji to collectively invest about Rs 750 crore in a 150 Mw floating solar power project in UP. It is not only touted as first such project in the state, but also the largest floating solar energy project in India.

The project would come up at the existing Rihand hydro power project of UP Jal Vidyut Nigam Limited (UPJVNL) at Sonbhadra in the arid Bundelkhand region, bordering Madhya Pradesh, Chhattisgarh, Jharkhand and Bihar.

ReNew Power and Shapoorji Pallonji will develop 100 Mw and 50 Mw of the solar power capacity, respectively. They will supply solar power to UPPCL for the next 25 years after commissioning at the rate of Rs 3.36 per unit.

“The PPAs signed under previous governments were steeper and had burdened the consumers with high tariffs. We are trying to offload high tariffs by signing PPAs having cheaper rates,” UP energy minister Shrikant Sharma said after the state cabinet cleared the proposal.

On account of incremental power demand, coupled with the government’s target to provide metered electricity to all the households, the state has projected the total power supply to touch 30,000 Mw by 2024.

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