The new control period of the tariff framework will be effective up to March 31, 2023, said state government sources. GERC had issued the previous generic tariff order in 2016, and the control period of the order expired on March 31, 2019
Ahmedabad: Power distribution companies in Gujarat can now procure solar and wind power from generation companies by way of competitive bidding. The Gujarat Electricity Regulatory Commission (GERC) has recently issued the tariff frameworks for the procurement of solar and wind power by distribution licensees in the state. This has replaced the earlier practice of generic tariffs.
The new control period of the tariff framework will be effective up to March 31, 2023, said state government sources. GERC had issued the previous generic tariff order in 2016, and the control period of the order expired on March 31, 2019.
The order on solar tariff framework was issued on May 8, and the commission said the useful life period for solar projects during the new control period will be 25 years. The commission further noted that solar projects commissioned and power purchase agreements (PPAs) signed during the new control period will be eligible to sell power to distribution licensees of Gujarat.
GERC said that the solar power projects established with only new machinery will be eligible for the tariff approved in the order. The maximum capacity of solar projects will be up to 50 per cent of the consumer’s sanctioned load for captive use, third party sale, or power projects set under the National Solar Mission for sale of power within the state.
For the power generated from small-scale solar projects between 0.5MW and 5MW, the procurement price shall be at the rate of tariff discovered by competitive bidding process at different time periods of six months plus an additional 20 paisa per kWh for projects located outside the solar park.
In case of wind power projects, to determine the tariff below the threshold limit of eligibility for participating in the competitive bidding, the weighted average of the latest tariff discovered through a competitive bidding process will be taken. The threshold limit for such projects is 25MW, the commission said in an order dated April 30.
The commission said that it does not find merit in determining the tariff for such projects, for which the benchmark capital cost, benchmark financing cost, benchmark O&M (operation & maintenance) costs will have to be first determined. So, to reduce the cost of regulation and to give sufficient clarity to investors investing in such projects, the commission has decided to consider the competitive bidding approach, according to the order.