MERC approves power sale agreements for 302 MW of Solar Projects in Maharashtra

The Maharashtra Electricity Regulatory Commission (MERC) has announced that it has approved power sale agreements (PSAs) for grid-connected solar photovoltaic (PV) projects tallying 302 MW under the Mukhyamantri Saur Krishi Yojana.

MERC was assessing a petition filed by the Maharashtra State Electricity Distribution Company Limited (MSEDCL) for the sanction of long-term procurement of 302 MW of solar power under Mukhyamantri Saur Krishi Vahini Yojana from Maharashtra State Power Generation Company Limited (MAHAGENCO/MSPGCL) in order to meet MSEDCL’s solar Renewable Purchase Obligation (RPO).

MSPGCL had conducted the process for the selection of solar power project developers for Phase- II (300 MW) and Phase – III (A) (50 MW) and finalized the successful bidders. It had then requested for the consent of MSEDCL for tariff discovered for 300 MW under Phase-II and 50 MW under Phase-III (A).

MSPGCL had also undertaken the development of solar projects by inviting Expression of Interest (EoI) for setting up solar projects of capacity up to 100 MW (cumulative or at a single location) to cater to the electrical load of agricultural (AG) feeders in Vidarbha, Marathwada, Western and Northern regions of Maharashtra on a pilot basis. MSPGCL has carried out reverse auction for the selection of bidders from a total of 48 bidders who responded to the EoI and finalized two bidders for a total capacity of 102 MW.

Out of these, the MSPGCL requested MSEDCL’s consent for a total of 302 MW solar PPAs. In September 2018, MSEDCL gave its consent on criteria of tariff rates received by MSPGCL for the procurement of 302 MW of solar power by signing of power sale agreement (PSA) for, 150 MW-Phase II, 50 MW–Phase IIIA and 102 MW-EoI. MSEDCL also stated that power evacuation will be at 11 kV with metering at the substation.

The proposed tariffs range between Rs.2.93 ($0.04213)/kWh and Rs.3.10 ($0.04458)/kWh. While examining the petition and submissions, the MERC opined that due process for procurement of solar power has been followed by MSEDCL. It further noted that the discovered tariff rates are within the vicinity of the rates earlier approved by the commission if one considers the transmission and distribution losses.

In April 2018, MSEDCL tendered 1 GW of solar PV projects to be developed under the Mukhyamantri Saur Krishi Vahini Yojana.

Lately, the MERC approved PPAs for power to be procured by MSEDCL from grid-connected solar photovoltaic (PV) projects totaling 235 MW at an average weighted average of Rs.3.13 (~$0.04501)/kWh. MERC noted that the average weighted tariff discovered by MSPGCL for these projects through competitive bidding process is Rs.3.04 ($0.04371)/kWh, the variation in the rates may be because of the geographic spread and smaller size of the projects.

Thus, the MERC accorded approval to PSA signing and ordered that solar power procured from these projects will be counted towards fulfilment of MSEDCL’s solar RPO.