The Maharashtra Electricity Regulatory Commission (MERC) has issued an order in Case No. 7 of 2025 concerning the long-term procurement of 5,008 MW of solar power under the Mukhyamantri Saur Krushi Vahini Yojana (MSKVY) 2.0 scheme. This initiative was led by the Maharashtra State Electricity Distribution Company Ltd. (MSEDCL), which filed the petition on 2 January 2025. The goal of this procurement is to provide daytime electricity to agricultural consumers by solarizing agricultural feeders.
The Commission heard the case and reviewed the competitive bidding process adopted by MSEDCL for both cluster-wise and individual substation-based tenders. These tenders were issued with a ceiling tariff of ₹3.10 per kilowatt-hour (kWh), with the intent to lower overall power procurement costs and reduce cross-subsidy burdens on industrial and commercial consumers.
The bidding process was carried out in multiple rounds. By 14 October 2024, a total of 11 rounds had been completed under the Open Tender category. MSEDCL awarded Letters of Award (LoAs) for 4988 MW of solar capacity under these rounds. Additionally, 20 MW was awarded under the Cluster Tender category. The successful bidders are required to sell the generated solar power to MSEDCL under long-term Power Purchase Agreements (PPAs) spanning 25 years. The weighted average tariff discovered in these bids was ₹3.05 per kWh, with tariffs ranging from ₹2.82 to ₹3.10 per kWh.
According to the order dated 11 March 2025, MERC has approved MSEDCL’s proposal to procure 5008 MW of solar power through these tenders. This procurement falls within the 5991 MW capacity previously sanctioned by the Commission on 20 September 2024 in Case No. 127 of 2024. The approved tariffs are considered competitive and reflect current market conditions.
MSEDCL emphasized that the procurement of this solar power will not only help it fulfill its Renewable Purchase Obligation (RPO) but will also enable the solarization of agricultural feeders, leading to improved electricity supply during the daytime. The MSKVY 2.0 scheme also provides a fiscal incentive of ₹0.25/kWh for energy injected at 11/22 kV bus bars for three years from the commissioning date, encouraging developers to participate.
The order also mentions that MSEDCL has already signed PPAs for 9,144 MW and issued LoAs for a cumulative 9,169 MW under MSKVY 2.0 Phase I. The second phase of bidding focused on individual substations and clusters not covered in the first phase, expanding opportunities for participation by smaller developers.
The Commission’s decision permits MSEDCL to continue awarding projects under the scheme, provided the discovered tariffs remain within the approved range of ₹2.90 to ₹3.10 per kWh, with a weighted average not exceeding ₹3.08 per kWh.
This order marks another significant step toward Maharashtra’s goal of solarizing agricultural electricity supply by December 2025 and fulfilling its distributed renewable energy obligations. The approved procurement process will contribute to reducing the state’s dependence on conventional energy sources, promoting clean energy, and ensuring affordable electricity for the agricultural sector.
