Welcome to India Renewable Energy News | Contact: +91 9220337640



Follow India Renewable Energy News on WhatsApp for exclusive updates on clean energy news and insights

RERC Approves Rs3.04/kWh Levelized Tariff for 5,000 MW Solar Projects Under PM-KUSUM

Rooftop Solar, Policy & Regulations

Mar 25, 2025

The Rajasthan Electricity Regulatory Commission (RERC) has approved a pre-determined levelized tariff of Rs3.04/kWh for 5,000 MW of solar power projects under Component-A of the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) scheme. This tariff will also serve as the ceiling price in future competitive bidding processes.

The petition was filed by Jaipur Vidyut Vitran Nigam on behalf of Rajasthan’s three power distribution companies (DISCOMs)—Jaipur Vidyut Vitran Nigam, Ajmer Vidyut Vitran Nigam, and Jodhpur Vidyut Vitran Nigam. The DISCOMs argued that implementing Component-A, which focuses on small-scale solar projects (up to 2 MW), would allow them to procure solar power at a lower rate of Rs3.04/kWh compared to their existing power purchase cost of Rs4.11/kWh.

Key Concerns Raised by Stakeholders

Several industry stakeholders expressed concerns about:

  • Capital Cost Assumptions – Some stakeholders argued that the estimated capital cost of Rs2.69 crore/MW was too low.
  • Capacity Utilization Factor (CUF) – The proposed CUF of 17% was higher than MNRE's 15% but lower than RERC’s 20?nchmark.
  • Land Lease Costs – The estimated Rs80,000/hectare/year lease cost, with a 5% escalation every two years, was debated.
  • Grid Integration & Energy Storage – Concerns were raised about injecting 5,000 MW of solar power without storage solutions.

After reviewing the objections, RERC upheld the Rs3.04/kWh tariff, citing recent bids that had resulted in even lower prices. The Commission found the capital cost, CUF, and land lease estimates reasonable based on market conditions.

Actions Directed by RERC

To address grid stability concerns, RERC directed DISCOMs to:

  • Conduct system studies to assess grid integration.
  • Collaborate with academic institutions for grid impact analysis.
  • Explore energy storage solutions in future procurements.
  • Propose time-of-day tariff adjustments to encourage daytime electricity consumption.

RERC also allowed DISCOMs to request tariff revisions if market conditions change. This approval follows RERC’s previous clearance of levelized tariffs for Jaipur and Jodhpur DISCOMs under Component-C of PM-KUSUM in September last year.