The Central Electricity Regulatory Commission (CERC) has given its approval for the prices at which electricity will be sold from NHPC’s 960 megawatt (MW) wind-solar hybrid power projects. The approved rates are ₹3.48 (about $0.04) per unit for some of the power and ₹3.49 (about $0.04) per unit for the rest, reports Mercom.
The approval follows NHPC’s request to validate the tariffs discovered through a competitive bidding process and to allow a trading margin for the electricity to be sold.
NHPC had issued a tender in November 2023 to develop 1,500 MW of wind-solar hybrid projects. Three companies participated in the bidding process, submitting proposals for a total capacity of 1,200 MW. As per the tender conditions, only 80 percent of the bid capacity could be awarded, resulting in 960 MW being allocated. NHPC distributed this capacity among the three bidders, with tariffs ranging from ₹3.48 to ₹3.49 per unit.
In preparation to sell the generated power, NHPC approached state distribution companies (DISCOMs) for offtake agreements. While Nagaland’s Department of Power agreed to purchase 88 MW at ₹3.56 per unit, the West Bengal distribution company, which had initially consented to procure up to 450 MW, later withdrew. NHPC has yet to secure buyers for the remaining power.
According to NHPC, the selected tariffs are below the cost at which DISCOMs typically buy conventional electricity. The company also noted that the projects are expected to be operational between 2026 and 2027, depending on when power purchase agreements (PPAs) are signed.
CERC confirmed that the bidding process was conducted in a fair and transparent manner. However, the Commission did not approve NHPC’s request for a trading margin of ₹0.07 per unit. Instead, it stated that the applicable trading margin will be determined by the terms of the power sale agreements (PSAs), which are yet to be finalized. Additionally, the Commission ruled that if NHPC fails to provide financial guarantees such as an escrow account or a secure letter of credit, the trading margin would be limited to ₹0.02 per unit.
CERC also directed NHPC to report once the project capacity is tied up under PPAs and PSAs, and to inform the Commission about any portion that remains unallocated. This regulatory decision plays a key role in shaping the next phase of NHPC’s renewable energy expansion, though the project’s progress will depend on NHPC’s ability to secure long-term buyers.
