UP goes green: UPERC leans towards state purchase of 1,500 MW solar power

The Uttar Pradesh Electricity Regulatory Commission (UPERC) has approved two solar power purchase agreements of the Uttar Pradesh Power Corporation Limited (UPPCL), paving the way for the infusion of clean energy with a total capacity of 1,500 MW into the state grid, according to people familiar with the development.

“These reciprocal approvals issued on October 3 are in line with Uttar Pradesh’s commitment to support renewable energy,” they said.

In the first order, UPERC approved UPPCL’s purchase of 1,000 MW of solar power from four developers at rates ranging from ₹2.52 to Rs 2.53 per unit.

The energy will be obtained through the Solar Energy Corporation of India (SECI), which will act as an intermediary. The developers involved are Avaada GJ Green Pvt. Limited (300 MW), Sprng Power Earth Pvt. Ltd. (250 MW), ReNew Solar Steller Pvt. Ltd. (300 MW) and Solarcraft Power India 17 Pvt. z o. o. (150 MW).

In its second order, UPERC has agreed to purchase another 500 MW by UPPCL at a flat tariff of Rs. 2.60 per unit, also thanks to SECI. This power will come from three developers: Jakson Limited (100 MW), Shiva Corporation India Ltd. (100 MW) and ReNew Solar Power Pvt. z o. o. (300 MW).

The controversial point of both approvals was the trading margin charged by SECI of 7 paise per unit, which UPERC said could have been lower for the benefit of consumers.

Despite this, the Commission stressed the urgent need to increase renewable energy capacity to meet Renewable Purchase Obligation (RPO) targets. The committee urged UPPCL to negotiate better terms for future contracts.

“Both the transactions are crucial to UPPCL’s alignment with its RPO targets, which will increase significantly in the coming years. The UPPCL analysis has provided detailed projections of potential power shortages from 2028-29 onwards, justifying the need for additional power,” a UPPCL official said.

The order is also in line with the Central Electricity Authority’s resource adequacy report, which has outlined significant solar capacity requirements for Uttar Pradesh by FY 2033-34.

The Union Ministry of Power (MoP) has increased the renewable energy obligation (RPO) for discoms from 15% in 2023-24 to 29.91% in 2024-25. This means that renewable energy must constitute 29.91% of the total energy that UPPCL will supply to consumers.

As per its action plan, UPPCL has to provide 21,500 MW of renewable energy by 2031-32 to meet its RPO obligations. This includes 8,500 MW of solar and 6,500 MW of wind and hydropower.