Peak demand crisis: Kerala State Electricity Board to procure 300 MW for 25 years via Solar Energy Corporation of India

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With the long-term needs of the State in mind, the Kerala State Electricity Board (KSEB) is going ahead with plans for procuring 300 megawatts (MW) for 25 years under a scheme of the Solar Energy Corporation of India (SECI).

While supply is expected to begin only in 2028 and will not help to alleviate the present power crisis, it is expressly meant to address peak demand. Keralam also stands to get the electricity at a tariff of ₹6.07 per unit.

The procurement is planned under tranche IX of the Firm and Dispatchable Renewable Energy (FDRE-IX) scheme of the public sector undertaking SECI. The supply is made from renewable energy projects with energy storage capability linked to the inter-state transmission system (ISTS). Of the 1,500 MW offered under this tranche, the SECI had offered 300 MW to the KSEB. Under the scheme, the SECI is the ‘intermediary procurer’ and the power will be supplied by ACME Solar Holdings Ltd.

“We can schedule the powerin advance. The long-term contract is meant to meet our electricity requirements during the non-solar hours,” a senior KSEB official said.

Through a September 14 order, the KSEB management has accorded sanction for procuring 300 MW of ‘assured four-hour peak power’ (1,200 MWh) for 25 years under the SECI FDRE-IX Scheme at a tariff of ₹6 per unit plus the SECI trading margin of ₹0.07 per unit. The full-time directors of the KSEB have approved the draft power sale agreement (PSA) with the SECI. The document will soon be placed before the Kerala State Electricity Regulatory Commission for securing its approval for the tariff under the PSA.

The SECI has been designated as a Renewable Energy Implementing Agency (REIA) for conducting large-scale renewable energy procurement via competitive bidding. The SECI serves as an ‘intermediary procurer’ by entering into power purchase agreements with the selected solar power developers and subsequently entering into PSAs with buying utilities such as the KSEB.

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