Downward revision in tariff for rooftop solar power plants

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Those installing rooftop solar plants from now on will be paid a lower tariff. The Karnataka Electricity Regulatory Commission (KERC) has revised the tariff payable for solar rooftop and small photovoltaic (PV) power generation, which will be applicable for power purchase agreements (PPAs) signed on or after May 2 until March 31 2018. Not only that, different tariffs have been fixed according to the capacity of the plants.The commission, in its order pronounced on Tuesday, has fixed the tariffs for solar plants of 1 to 10 kW capacity at Rs. 7.08 per unit without capital subsidy and Rs. 6.03 per unit (with capital subsidy). This is a reduction from Rs. 9.56 per unit and Rs. 7.20, respectively.Among the other salient features of the order is the introduction of gross metering for domestic consumers, hospitals and educational institutions. Under this concept, consumers are allowed to sell the entire energy generated by their plants to the Electricity Supply Companies (Escoms) irrespective of self-consumption.Net-metering will be applicable for industrial, commercial and all categories of consumers other than domestic, hospital and educational institutions, wherein consumers are allowed to sell surplus energy to Escoms after self-consumption. The present installed capacity of MW scale plants in the State is said to be 134 MW as on March 31, 2016.Explaining the need for midcourse revision of tariff, the order says the commission’s October 2013 order was to be applicable for solar rooftop and small solar plants entering into PPAs on or after April 1, 2013 and up to March 31, 2018.It was assumed that the capital cost reckoned for determination of tariff would not vary substantially during the control period. However, during the financial years 2014 and 2015, the commission has noticed a substantial decline in the prices of solar panels and allied equipment resulting in considerable reduction in cost of solar power generation leading to investors/developers offering to supply power from solar plants at rapidly declining rates,” the order said, adding that the growth of investments necessitated ‘moderation’ of the promotional tariff offered earlier to attract investments.


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