Madhya Pradesh Signs PPAs for 4,022 MW Decentralised Feeder Solarisation Projects

Madhya Pradesh has signed PPAs for 4,022 MW of decentralised solar projects under the ‘Krishi Mitra Surya Feeder Yojana’ (SMKFY), among India’s largest feeder solarisation programmes. The signing ceremony was attended Chief Minister Dr. Mohan Yadav, Energy Minister Pradyuman Singh Tomar and New and Renewable Energy Minister Rakesh Shukla.

The projects will be developed across 493 substations, with individual capacities ranging from 1.6 MW to 18.15 MW, creating a highly decentralised solar network. According to Manu Srivastava, the scheme is designed to support daytime power supply to farmers while reducing the burden on the state distribution network.

Tariffs discovered under the scheme range between INR 2.40 and INR 2.85 per unit, among the lowest achieved for decentralised renewable energy projects in India. The rates have been secured without any subsidy support from either the Government of India or the state government. Developers have also arranged land independently, without relying on government-owned land.

State officials estimate that compared to the typical INR 3 per unit tariff achieved in similar decentralised renewable energy projects in other states, the lower tariff under SMKFY could save Madhya Pradesh around Rs 250 crore annually. Compared with tariffs for large interstate transmission system-connected renewable energy projects, including transmission losses and charges, annual savings could reach nearly INR  1,248 crore.

The tender attracted 548 bidders, including 114 farmers and 147 micro, small and medium enterprises. A total of 85 developers have been selected, of which 47 have secured only one substation each, highlighting broad participation rather than concentration among a few large players.

Under the project design, solar power will be injected on the low-voltage side of 33/11 kV substations. Solar capacity has been matched to the transformer capacity, effectively doubling the usable daytime capacity of distribution transformers without requiring additional capital expenditure.

Officials said this approach could help distribution companies defer or avoid more than INR 500 crore in investments for transmission and distribution infrastructure upgrades. It will also enable supply of low-cost solar power to the agricultural sector during daytime hours.

The scheme also includes provisions for reactive power management. Decentralised renewable energy generators will act as distributed voltage regulators by injecting reactive power when voltage is low and absorbing it when voltage is high, helping stabilise the grid locally.

The technical concept was developed by the Centre for Mission on Energy Transition at Maulana Azad National Institute of Technology as part of a study supported by the World Bank Group.

Technical implementation of the project is being supported by Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH, while Sequoia Climate Foundation, Shakti Sustainable Energy Foundation and Idam Infrastructure Advisory Pvt. Ltd. are assisting in streamlining the execution process.