KSERC Approves 200 MW Solar-Plus-Storage PSA Between KSEB and SECI

The Kerala State Electricity Regulatory Commission (KSERC) has issued a regulatory order (OP No. 31/2026) dated July 27, 2026, approving the Power Sale Agreement (PSA) between the Kerala State Electricity Board Ltd (KSEB) and the Solar Energy Corporation of India (SECI). The approval was granted under Regulation 77 of the KSERC (Terms and Conditions for determination of Tariff) Regulations, 2021, read with Section 86(1)(b) and (e) of the Electricity Act, 2003. The decision clears the way for KSEB to procure 200 MW of solar power integrated with a 100 MW / 400 MWh Energy Storage System (ESS/BESS) for a 25-year tenure. This “firm and dispatchable” capacity, sourced under SECI’s ISTS Tranche XX scheme, is intended to mitigate the state’s evening peak deficits.

Commercial Terms and Project Participants

The agreement involves a structured procurement framework through SECI as the intermediary to facilitate power flow from Gujarat to the Kerala periphery.

• Intermediary Procurer: Solar Energy Corporation of India (SECI), a Navaratna CPSU.
• Project Developer: Welspun Renewable Energy Private Limited.
• Special Purpose Vehicle (SPV): M/s Satpura Renewable Private Ltd (a subsidiary of Welspun).
• Project Location: Village Veraval Moti, Taluka Lalpur, District Jamnagar, Gujarat, with injection at an ISTS substation.
• Tariff Breakdown:
  • Discovered Generator Tariff: Rs. 2.86/kWh.
  • Trading Margin: Rs. 0.07/kWh.
  • Final Effective Tariff: Rs. 2.93/kWh.
• Timelines: The PSA was signed on March 13, 2026, following a Power Purchase Agreement (PPA) effective date of April 1, 2026. The Scheduled Commencement of Supply Date (SCSD) is set for April 1, 2028.

Operational Supply Requirements and Peak Delivery

The project is mandated to provide a specific delivery profile to ensure the power is dispatchable during high-demand windows.

Peak-Period Obligations and Scheduling

KSEB has the authority to select any 4-hour window for daily peak delivery between 18:00 (6 PM) and 24:00 (midnight). During these hours, the developer must supply 2,000 kWh per MW of contracted capacity, totaling 0.40 MU per day for the 200 MW allocation. Crucially, KSEB must provide the daily delivery schedule by 6:00 AM. Should KSEB fail to meet this scheduling deadline, the developer retains the right to supply peak power at its own discretion.

Supply Thresholds and Purchase Caps

The agreement specifies annual energy supply obligations to maintain grid reliability:

• Minimum Annual Supply (Years 1–10): 417.26 MUs.
• Minimum Annual Supply (Years 11–25): 392.72 MUs.
• Maximum Annual Purchase Obligation: 539.99 MUs (capped at +10% of declared energy).

Penalty Framework and Performance Compliance

To safeguard KSEB against shortfalls and unauthorized market activity, the Commission has approved a rigorous penalty mechanism:

• Annual CUF Shortfall: If the developer fails to meet the minimum annual Capacity Utilization Factor (CUF) thresholds, it is liable to pay a penalty equal to 1.5 times the PPA tariff for the energy deficit.
• Peak Hour Shortfall: Any deficit in the mandated daily peak power supply attracts a penalty of 1.5 times the PPA tariff.
• Unauthorized Third-Party Sales: If the developer sells power to a third party while failing to fulfill its commitments to KSEB, a penalty of 1.5 times the highest prevailing market rate—among the Day-Ahead Market (DAM), Green Day-Ahead Market (G-DAM), or Real-Time Market (RTM)—will be levied and passed to KSEB.

ISTS Waiver and Commission Directives

The financial viability of the project is contingent upon the Inter-State Transmission System (ISTS) regulatory framework.

• ISTS Waiver and Losses: The project is eligible for a 100% waiver of ISTS charges because it features a co-located BESS and is scheduled for commissioning before the June 30, 2028, deadline. However, KSEB must still bear the ISTS transmission losses, which are estimated to range between 3.0% and 3.50%.
• Transparency and Monitoring: The Commission directed KSEB to review project progress on a monthly basis. KSEB is mandated to update its official website monthly with these status reports to ensure transparency and mitigate the risk of losing the ISTS waiver if commissioning slips past the June 2028 cutoff.
• Expansion of Capacity: Noting that only 500 MW of the total 2,000 MW available under SECI’s ISTS-XX scheme has been tied up, the Commission directed KSEB to explore additional capacity. KSEB must submit a status report regarding its assessment of further power requirements by August 5, 2026.

Quick Fact Box: KSERC Approval Summary

Official Sources and Regulatory Citations

• Kerala State Electricity Regulatory Commission (KSERC)
  • Regulatory Order: Order dated 27.07.2026 in Petition OP No. 31/2026 (Approval of PSA for 200 MW Solar-Storage between KSEBL and SECI).
  • Official Website: erckerala.org
• Central Electricity Regulatory Commission (CERC)
  • Regulatory Order: Order dated 24.03.2026 in Petition No. 975/AT/2025 (Adoption of Tariff for 2000 MW ISTS Solar PV with BESS under SECI-ISTS-XX).
  • Draft Regulation: Draft Fifth Amendment to the Sharing of Inter-State Transmission Charges and Losses Regulations, 2026.
  • Official Website: cercind.gov.in
• Ministry of Power (MoP), Government of India
  • Bidding Guidelines: Resolution dated 09.06.2023 (Guidelines for Tariff Based Competitive Bidding for Firm and Dispatchable Power from RE with ESS).
  • ISTS Waiver Order: Order File No. 12/07/2023-RCM dated 10.06.2025 regarding 100% waiver of ISTS charges for co-located BESS.
  • Official Website: powermin.gov.in
• Ministry of New and Renewable Energy (MNRE)
  • Policy Rules: Green Energy Open Access Rules 2026 and PM-Surya Ghar: Muft Bijli Yojana.
  • Approved List: Approved List of Models and Manufacturers (ALMM) List-II (Solar Cells).
  • Official Website: mnre.gov.in