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PSERC Sets Tariff For Six MW Biomass Plant
OIL & GAS

PSERC Sets Tariff For Six MW Biomass Plant

The Punjab State Electricity Regulatory Commission, vide order dated 27 March 2026 in Petition No. 59 of 2024, determined the tariff for the six megawatt (MW) biomass-based power plant of the wholly owned subsidiary Malwa Power Pvt. Ltd for an extended ten year term following expiry of the initial twenty year power purchase agreement. The plant was commissioned on 27 April 2005 and operated under a PPA dated 19 February 2004 with Punjab State Power Corporation Limited that expired on 26 April 2025, and it received an interim tariff of Rs three point five per kWh during litigation.

The Commission determined an applicable tariff of Rs five point two two four per kWh for fiscal year 2025-26, with a five per cent escalation on the variable component annually, after examining submissions and benchmarking standalone biomass independent power producers against co-generation plants. The fixed component was determined at Rs zero point nine seven per kWh which the company regards as low, and the regulator relied on earlier CERC regulations from 2012 rather than the CERC RE Regulations 2024 referenced by the company.

Between May 2025 and February 2026 the plant supplied approximately 33.7 million (mn) kWh at the interim rate and the company is entitled to recover a differential of about Rs 58.0 mn for that period. Based on projected operations at an 85 per cent plant load factor, maximum generation is projected at 65.7 mn kWh with net export of 45.32 mn kWh for fiscal 2026-27 and estimated power revenue of Rs 243.1 mn.

The biomass pellet plant at Village Gulabewala has an installed capacity of 72,000 tonne (t) per annum and at 50 per cent operating capacity is expected to produce 36,000 t and generate approximately Rs 234.0 mn annually, implying combined MPPL revenue of about Rs 477.1 mn for the year. The company indicated it is actively evaluating legal and regulatory options including an appeal to the Appellate Tribunal for Electricity to seek tariff revision and will pursue steps to protect contractual rights and commercial interests.

The Punjab State Electricity Regulatory Commission, vide order dated 27 March 2026 in Petition No. 59 of 2024, determined the tariff for the six megawatt (MW) biomass-based power plant of the wholly owned subsidiary Malwa Power Pvt. Ltd for an extended ten year term following expiry of the initial twenty year power purchase agreement. The plant was commissioned on 27 April 2005 and operated under a PPA dated 19 February 2004 with Punjab State Power Corporation Limited that expired on 26 April 2025, and it received an interim tariff of Rs three point five per kWh during litigation. The Commission determined an applicable tariff of Rs five point two two four per kWh for fiscal year 2025-26, with a five per cent escalation on the variable component annually, after examining submissions and benchmarking standalone biomass independent power producers against co-generation plants. The fixed component was determined at Rs zero point nine seven per kWh which the company regards as low, and the regulator relied on earlier CERC regulations from 2012 rather than the CERC RE Regulations 2024 referenced by the company. Between May 2025 and February 2026 the plant supplied approximately 33.7 million (mn) kWh at the interim rate and the company is entitled to recover a differential of about Rs 58.0 mn for that period. Based on projected operations at an 85 per cent plant load factor, maximum generation is projected at 65.7 mn kWh with net export of 45.32 mn kWh for fiscal 2026-27 and estimated power revenue of Rs 243.1 mn. The biomass pellet plant at Village Gulabewala has an installed capacity of 72,000 tonne (t) per annum and at 50 per cent operating capacity is expected to produce 36,000 t and generate approximately Rs 234.0 mn annually, implying combined MPPL revenue of about Rs 477.1 mn for the year. The company indicated it is actively evaluating legal and regulatory options including an appeal to the Appellate Tribunal for Electricity to seek tariff revision and will pursue steps to protect contractual rights and commercial interests.

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