Gujarat Urja Vikas Nigam Limited (GUVNL) filed a petition before the Gujarat Electricity Regulatory Commission (GERC) seeking approval for a Power Purchase Agreement (PPA) signed with NTPC Renewable Energy Limited (NREL) for the procurement of 500 MW solar power from a project located at Khavda Renewable Energy Park in Kutch. The petition was filed under Section 86(1)(b) of the Electricity Act, 2003, which empowers the Commission to regulate electricity procurement processes of distribution licensees, including approving tariffs and power purchase agreements.
GUVNL highlighted that this agreement is under the bilateral procurement mode, not through a tariff-based competitive bidding process under Section 63 of the Act. NREL, a subsidiary of NTPC Green Energy Limited, proposed to supply power at ₹2.78/kWh at the ISTS ex-bus point. The proposed project is located on land allocated by the Gujarat Government to NREL for developing a 4,750 MW renewable park.
Initially, GUVNL sought to sign the PPA based on its standard terms as per TBCB guidelines, but NREL insisted on using its own bilateral PPA format. After multiple rounds of negotiation, both parties reached a mutual agreement and finalized the PPA on March 15, 2024. The agreement includes several key provisions such as a 25-year term, a scheduled commissioning date of December 14, 2025, and a capacity utilization factor (CUF) of 30%. The project allows part commissioning with specific conditions and includes detailed clauses for liquidated damages, early commissioning, generation shortfalls, excess generation, change in law, and payment security.
GUVNL emphasized the importance of this project to meet rising renewable purchase obligations (RPO) as mandated by both the state commission and the Ministry of Power, Government of India. The solar power is intended to support initiatives like the Kisan Suryodaya Yojana, aimed at providing daytime power to agricultural consumers. GUVNL also detailed that this power purchase will help address growing RPO targets, which are projected to rise significantly by 2030.
No objections were received from stakeholders during the public notice period. The Commission heard the matter on June 12, 2024, and issued directions for compliance, including publishing the petition in newspapers and uploading it on GUVNL’s website for stakeholder feedback.
GUVNL reiterated that signing a bilateral PPA with NREL is necessary to ensure timely renewable capacity addition, optimize costs, and meet state-level renewable targets. The Commission is yet to provide a final ruling on the petition, but acknowledged the significance of the agreement for fulfilling renewable energy commitments.
