KSEBL Gains Approval for 500 MW Solar Power Purchase Agreement with SECI at ₹3.41–₹3.42 per kWh

The Kerala State Electricity Regulatory Commission (KSERC) has granted approval to the Kerala State Electricity Board Ltd. (KSEBL) for a significant 500 MW solar power deal with the Solar Energy Corporation of India (SECI). This agreement marks a major milestone in Kerala’s renewable energy landscape, offering 250 MW of solar power specifically designed to meet peak demand during critical hours.

The deal is part of SECI’s ISTS Tranche XV Scheme, aimed at integrating solar energy with energy storage solutions to provide a reliable power supply during peak periods. KSEBL’s petition, submitted in October 2024, highlighted the importance of renewable energy storage in fulfilling growing energy demands and achieving the state’s Renewable Purchase Obligations (RPO). The PSA, signed in September 2024, commits KSEBL to sourcing power from developers selected through SECI’s competitive bidding process for the next 25 years.

Key developers such as Pace Digitek Infra, Hero Solar Energy, and ACME Solar Holdings secured contracts under this initiative, with tariffs set between ₹3.41 and ₹3.42 per unit. The project is expected to commission in September 2026.

The scheme not only addresses the challenges of energy deficits during peak hours but also supports the growing demand for green energy tariffs, particularly among commercial and industrial consumers. Despite the benefits, concerns regarding the estimated power costs at the Kerala periphery, expected to be around ₹3.94–₹3.95 per unit, were raised due to interstate transmission charges and losses.

In response, KSERC has advised KSEBL to refine its power procurement strategies and create a resource adequacy plan that balances economic feasibility with sustainability goals. The Commission also recommended expediting project timelines to lower the transmission costs, potentially bringing the price down to ₹3.79–₹3.80 per unit.

The Commission ultimately approved the PSA with conditions and emphasized collaboration between KSEBL, SECI, and the developers to ensure timely execution and effective implementation, paving the way for a sustainable and reliable energy future for Kerala.