The Central Electricity Regulatory Commission (CERC) has recently approved NTPC Limited’s petition concerning usage charges for a 1,990 MW Solar Photovoltaic (PV) project under the Central Public Sector Undertaking (CPSU) Scheme Phase-II. This significant milestone reflects NTPC’s commitment to expanding India’s renewable energy capacity while adhering to transparent regulatory processes.
Background of the CPSU Scheme Phase-II
Launched by the Ministry of New and Renewable Energy (MNRE) in 2019, the CPSU Scheme Phase-II is designed to promote grid-connected solar PV projects with financial support through Viability Gap Funding (VGF). The scheme aims to bolster India’s renewable energy targets by leveraging competitive bidding processes to ensure cost efficiency and transparency.
NTPC’s 1.99 GW Solar PV Project
NTPC Limited, along with its subsidiary NTPC Renewable Energy Limited, secured a 1,990 MW solar capacity allocation through a bidding process facilitated by the Indian Renewable Energy Development Agency Limited (IREDA). The project is divided into two parts:
- 735 MW executed directly by NTPC
- 1,255 MW undertaken by NTPC Renewable Energy Limited
Post-allocation, NTPC signed Power Usage Agreements (PUAs) with various entities, including Telangana Discoms, Damodar Valley Corporation, and Madhya Pradesh Power Management Company.
CERC’s Evaluation and Key Highlights
The CERC assessed NTPC’s petition based on the provisions of the CPSU Scheme and the Electricity Act, 2003. Key considerations included:
- Transparency in Bidding: The Commission confirmed that the competitive bidding process adhered to the guidelines issued by the Ministry of Power.
- Usage Charges: NTPC’s petition proposed usage charges at ₹2.57/kWh, citing increased GST rates. However, the Commission upheld the originally bid tariff of ₹2.45/kWh, allowing provisional compensation for additional charges pending final approval under the “Change in Law” provisions.
- Viability Gap Funding: The allocation of VGF was scrutinized to ensure compliance with the scheme’s guidelines.
Implications for the Renewable Energy Sector
This approval reinforces the significance of competitive bidding in promoting fair practices within the renewable energy sector. It highlights CERC’s role in maintaining compliance with legal frameworks and ensuring that project execution aligns with pre-determined guidelines. Additionally, the decision to provisionally allow compensation for increased charges underscores the Commission’s pragmatic approach to addressing unforeseen challenges like tax revisions.
Conclusion
NTPC’s achievement under the CPSU Scheme Phase-II not only contributes to India’s clean energy ambitions but also underscores the importance of regulatory oversight in driving sustainable growth. As the renewable energy sector continues to evolve, such initiatives pave the way for a greener and more resilient future.
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