Assam: Minimize solar project cost to check tariff burden, directs AERC to APDCL

Staff Reporter

Guwahati: Noting that other states have much lower solar generation costs in comparison to the proposed cost of Assam Power Distribution Company Ltd. (APDCL), the Assam Electricity Regulatory Commission (AERC) directed APDCL to look for a project at a minimum cost so that it can improve APDCL's power purchase scenario without adversely impacting the consumer's tariff.

AERC issued the direction on a petition submitted by APDCL for approval of the Request for Selection (RfS) document, Draft Power Purchase Agreement (PPA), and Ceiling tariff of 15 MW AC Grid Connected Ground Mounted Solar Photovoltaic (PV) Power Projects to be developed by APDCL on "Build-Own-Operate" mode through a tariff-based competitive bidding process in Bamgaon village near Balipara under Chariduar Revenue Circle in Sonitpur District for sale of power to APDCL.

The AERC held a hearing on April 2, 2025, and asked APDCL to submit their points on the queries raised by it during the last hearing. The AERC, vide an order dated December 9, 2024, directed APDCL to revisit the ceiling tariff below Rs.3.90/kWh. In compliance with the aforementioned order, the APDCL published the RFS on December 16, 2024, with a ceiling tariff of Rs.3.33/kWh. After requests from prospective bidders in the pre-bid meeting held on January 3, 2025, and to attract more participation, the ceiling tariff was raised to Rs.3.60/kWh.

APDCL also mentioned that a few of the prospective bidders requested raising the ceiling tariff on the following grounds: Generally, Global Horizontal Irradiance (GHI) is less in Northeastern states as compared to other parts of India; the capacity of Solar Power Projects (SPPs) is less, resulting in higher maintenance costs; the project is located in an isolated place and rough terrain, due to which transportation costs will be very high; and also arranging equipment for erection from nearby locations is very difficult, which leads to additional costs.

APDCL also mentioned that the prospective bidders have raised concerns regarding the capacity of the project due to the possibility of water inflows into the site owing to lowland towards the side near the river and no embankment of the nearby river.

The AERC examined the matter in detail, as per the provisions of the Electricity Act, 2003, AERC Regulations, and other details presented before it. It noted the submission of APDCL and mentioned that two projects of capacities 50 MW and 70 MW at Borsola and Bilasipara were awarded on August 28, 2023, and the tariff discovered through competitive bidding was Rs.3.92/kWh, which includes the land cost.

Therefore, the AERC observed that the project cost of Rs 3.92/kWh without the land cost for this 15 MW AC Grid Connected Ground Mounted Solar PV Power Project is on the higher side, and it will have an impact on the consumers. It noted that other states have much lower solar generation costs in comparison to the proposed cost of APDCL. Therefore, APDCL was directed to look for a project at a minimum cost such that it can improve APDCL's power purchase scenario without adversely impacting the consumer's tariff.

Also Read: Assam: APDCL Proposes Hike In Electricity Tariff

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