RPO Regulatory Fund Asks Uttar Pradesh DISCOM to Deposit Over Rs 7 Billion 

The commission has asked UPPCL to deposit an amount of ₹7.37 billion (~$103.3 million) in four installments, which are to be transferred each month for December 2019, January 2020, February 2020, and March 2020

January 07, 2020. By Darshana Daga

The Uttar Pradesh Regulatory Commission (UPERC) has directed the Uttar Pradesh Power Corporation Limited (UPPCL) to create a separate renewable purchase obligation (RPO) Regulatory Fund. The commission has directed UPPCL to deposit the amount of the respective shortfalls in solar and non-solar purchase obligations until the financial year 2019-20 at the rate of ₹1 (~$0.014)/kWh.

The amount deposited will be used to procure respective renewable energy power as per the roadmap provided by UPPCL.

Earlier this year, the state commission had ordered its electricity distribution companies to respond to the suo moto proceedings about meeting RPO targets. The suo moto proceedings were initiated in February 2019.

UPPCL had rectified the deficiencies as highlighted by the Commission and submitted the revised data for the consideration of the Commission. In its submission, UPPCL had noted that it proposes to meet the backlog RPO without any distinction in the periods (2010-11 to 2014-15 and 2015-16 to 2018-19).

The Solar Energy Corporation of India (SECI) recently signed two power sale agreements with UPPCL, one of 750 MW at a tariff rate ₹2.55 (~$0.036)/kWh and another for 200 MW at ₹2.89 (~$0.041)/kWh both for 25 years.

The solar RPO backlog up to 2018-19 stands at 2,930.33 MUs, and for non-solar, it is at 4,440.79 MUs. The UPPCL is expected to meet the entire solar RPO backlog by the end of 2021-22 and non-solar RPO by mid-2021-22.

According to the regulations 7 and 8 of UPERC Regulations, 2010, if the obligated entity doesn’t fulfill its RPO target during any year, it will have to deposit the amount into a separate fund based on the shortfall in units of RPO regulatory charges and forbearance price.

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