Chhattisgarh State Power Distribution Company Limited (CSPDCL) submitted a petition for approval of bid documents and adoption of tariff for purchasing solar power under the PM-KUSUM Component-C scheme. This scheme promotes setting up grid-connected solar power plants by renewable energy developers using the RESCO model. A total capacity of 600 MW (AC) was targeted across different locations in Chhattisgarh for a duration of 25 years.
CSPDCL, the implementing agency of the scheme in the state, issued a Request for Selection (RfS) on October 4, 2023. The scheme aimed to solarize agricultural feeders by installing solar PV plants and using the generated power locally, thereby reducing losses and the overall load on the distribution system. CSPDCL adopted bidding documents from the Maharashtra State Electricity Distribution Company Limited (MSEDCL) with slight changes related to metering.
Out of the required 600 MW, only 310 MW received eligible bids. Tariffs quoted ranged between ₹3.04/kWh to ₹9.00/kWh. To arrive at a justifiable price, CSPDCL formed a negotiation committee that referred to an earlier tariff benchmark of ₹4.24/kWh set by the Commission. Taking into account factors like cost inflation, DCR panel prices, and maintenance expenses, the committee proposed ₹3.50/kWh as the maximum purchase price, which CSPDCL then submitted for approval.
Objections were raised during the public consultation. Stakeholders, particularly Vishwa Shakti Industries and Soumitra Fuels, argued that ₹3.50/kWh was too low due to high project costs driven by the mandatory use of more expensive DCR solar panels. They claimed operational costs are around ₹20 lakh per MW annually and suggested the generic levellised tariff should be ₹4.34/kWh. They also questioned the accuracy of tariff comparisons with other states and highlighted issues with the current bid documents, suggesting changes such as removal of certain metering clauses, re-evaluation of project cost and CFA, lowering minimum generation criteria, and state support for land acquisition.
In response, CSPDCL defended its proposed tariff, stating that the lowest bid received was ₹3.04/kWh, and with the availability of Central Financial Assistance (CFA) of ₹1.05 crore per MW, the effective cost burden would be reduced. They also pointed out that the estimated project costs presented by objectors were inflated due to inclusion of equity which is not required under the scheme.
The Chhattisgarh Electricity Regulatory Commission, after reviewing all submissions and objections, concluded that the bidding process and tariff determination were in accordance with guidelines and appropriate for the state’s conditions. The Commission approved the use of ₹3.50/kWh as the standard tariff for the selected solar projects under PM-KUSUM Component-C and accepted the bid documents submitted by CSPDCL. Thus, the case was settled with formal approval of both the bidding documents and the final tariff.
