Karnataka Lowers PV Benchmark Tariff

• Karnataka's electricity regulatory commission has determined 4.36 INR ($0.064) per kWh as the new benchmark tariff for FY 2017-18 for new grid-connected MW-scale solar power projects
• The new tariff will be applicable to project PPAs signed either on or after April 1, 2017 and before April 1, 2018
• Projects with PPA's signed before April 1, 2017 are eligible for the new tariff only if they are not commissioned by the COD and will achieve COD between April 1, 2017 and March 31, 2018
• The benchmark tariff for grid connected rooftop solar power plants has been left unchanged

Large scale solar power projects will fetch a benchmark tariff of 4.36 INR ($0.064) per kWh for the financial year 2017-18 in Karnataka. The Karnataka Electricity Regulatory Commission (KERC) has decided that the new benchmark tariff will apply to all new grid connected MW-scale solar PV projects that have entered into a power purchase agreement (PPA) on or after April 1, 2017 and before April 1, 2018.

The revised tariff will also be applicable to projects for which PPAs were signed before April 1, 2017, but are not commissioned by COD, and achieve COD between April 1, 2017 to March 31, 2018.

For the previous year, the benchmark tariff in this category was 6.51 INR ($0.096) per kWh. It has now dropped down by 2.15 INR ($0.033). KERC had earlier proposed a tariff of 4.51 INR ($0.066) per kWh. Declining module prices were taken into consideration before determining the new tariff, according to clean energy communications and consultancy firm Mercom Capital Group. Average module cost per watt was taken as 23.49 INR ($0.35).

The tariff for solar rooftop PV projects will continue to remain the same until March 31, 2018 as was decided previously by the agency in May 2016. It was determined according to the capacity of the plant and with and without capital subsidy.

Karnataka is aiming to achieve a minimum of 400 MW of grid connected solar rooftop plants and 1,600 MW of grid connected utility scale solar projects in the state by 2018. By 2021, it wants to have total solar power generation capacity of around 6,000 MW.

The detailed decision on tariff revision can be accessed on Karnataka government's website.