MSEDCL 1,600 MW Solar Procurement Approved: JSW, Anboto, Apraava, Avaada to Supply Power

Key Takeaways

• Agency: Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL), approved by Maharashtra Electricity Regulatory Commission (MERC)
• Capacity: 1,600 MW solar power procurement
• Bidding conducted by: NTPC Limited (as Renewable Energy Implementing Agency)
• Winners: JSW Renew Energy (700 MW), Anboto Solar (300 MW), Apraava Energy (300 MW), Avaada Suryapower (300 MW)
• Landed tariff: Rs 2.66 to Rs 2.72 per kWh (including Rs 0.07/unit NTPC trading margin)
• Supply commencement: June 30, 2026
• PPA duration: 25 years from commencement date
• MERC approval: January 2026

What Is This Procurement?

The Maharashtra Electricity Regulatory Commission (MERC) issued its final approval order in January 2026, clearing Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL) to procure 1,600 MW of solar power from four developers selected through a competitive bidding process conducted by NTPC Limited.

NTPC Limited, acting as the Renewable Energy Implementing Agency (REIA), ran the tender and auction process on MSEDCL's behalf — a model increasingly used in India where central agencies or experienced procurers run tenders for state DISCOMs that may lack the technical capacity for complex renewable energy procurement.

This 1,600 MW procurement is significant for Maharashtra's energy transition. MERC noted that the tariff range of Rs 2.66–2.72/kWh is substantially below MSEDCL's actual average power purchase cost of Rs 4.82/kWh for FY 2023–24 — meaning this solar procurement directly reduces the average cost of power for Maharashtra's distribution system, benefiting all consumers including industrial buyers who pay cross-subsidy charges based on MSEDCL's purchase cost.

Winners and Capacity Allocation

Note: The "landed tariff" includes a trading margin of Rs 0.07 per unit payable to NTPC Limited for conducting the bidding process.

JSW Renew Energy is the renewable energy arm of the JSW Group, one of India's largest industrial conglomerates. Winning 700 MW — the largest single allocation in this procurement — reflects JSW Renew's scale and financial strength. Anboto Solar is a renewables-focused developer. Apraava Energy (formerly CLP India) is a Hong Kong-based energy group with significant India renewables operations. Avaada Suryapower is part of the Avaada Group, an Indian renewable energy developer with a large solar portfolio.

Why MERC Approved This Procurement

MERC's approval order highlighted several justifications for the procurement:

1. RPO compliance: The procurement supports MSEDCL in meeting its long-term Renewable Purchase Obligation (RPO) targets — a regulatory requirement for all Indian DISCOMs to source a specified percentage of power from renewables. MERC noted that MSEDCL had shortfalls in its RPO fulfilment in recent years.

2. Cost savings: At Rs 2.66–2.72/kWh, the solar tariff is dramatically below MSEDCL's average purchase cost of Rs 4.82/kWh. Each unit of solar power that displaces conventional thermal power saves Maharashtra consumers approximately Rs 2.10–2.16 per unit.

3. CERC precedent: The Central Electricity Regulatory Commission (CERC) had already approved identical tariffs in September 2024, providing regulatory clarity. MERC's January 2026 approval followed the CERC precedent.

4. Grid management: MSEDCL plans to manage variable solar generation through 3,500 MW of pumped storage capacity and 2,750 MW of Battery Energy Storage Systems (BESS) being developed in parallel. This integrated storage plan was a key factor in MERC's approval of large-scale solar procurement.

Maharashtra's Solar Procurement Context

This 1,600 MW approval is part of a broader wave of Maharashtra solar procurement activity in 2025–26:

Solar + Storage Mandate: Maharashtra became one of the first Indian states to mandate solar-plus-storage for new large commercial and industrial consumers in 2026, requiring that solar projects above a certain capacity threshold include battery storage or pumped hydro. See our detailed post on the Maharashtra solar storage mandate for commercial and industrial consumers for full details.

MSEDCL policy changes: From February 13, 2026, MSEDCL updated its rooftop solar portal with consumption-linked capacity approval — limiting the rooftop solar system size to align with the applicant's historical 12-month electricity consumption. This affects industrial consumers planning large rooftop installations.

Pumped storage and BESS: The 3,500 MW pumped storage and 2,750 MW BESS pipeline referenced in MERC's approval order signals that Maharashtra is planning for grid-scale storage to back up its growing solar base — a policy direction that benefits all consumers and strengthens the case for solar adoption.

What This Means for Maharashtra Industrial Solar Buyers

For large industrial consumers in Maharashtra, the MERC-approved 1,600 MW procurement has several implications:

Tariff signal: The Rs 2.66–2.72/kWh tariff benchmark confirms that large-scale solar procurement in Maharashtra is firmly in the sub-Rs 3/kWh range for utility-scale projects. Industrial buyers procuring solar through open access or captive arrangements will pay higher all-in costs (due to transmission charges, wheeling charges, banking charges, and cross-subsidy surcharges), but the underlying solar generation cost continues to fall.

RPO reduction in cross-subsidy: As MSEDCL's average power purchase cost decreases through cheaper solar procurement, the basis for cross-subsidy surcharges (charged to open-access consumers) may gradually rationalise — though regulatory decisions on surcharge levels remain with MERC.

Grid reliability: The concurrent 3,500 MW pumped storage and 2,750 MW BESS planning signals that Maharashtra is investing in grid storage to back up its solar fleet. This improves long-term grid reliability for all consumers, including industrial buyers on the Maharashtra grid.

Rooftop solar opportunity: MSEDCL's active solar procurement — and the scale of its storage planning — suggests a grid increasingly capable of absorbing distributed rooftop solar from industrial consumers. The new consumption-linked approval rule (February 2026) limits rooftop solar to historical consumption, but large industrial consumers with 12-month electricity data already consumed at scale will find this limit non-binding in most cases.

For industrial buyers in Maharashtra evaluating solar options, see our guide on industrial solar for Maharashtra facilities and our overview of the Maharashtra solar storage mandate.

NTPC's Role as Renewable Energy Implementing Agency

This procurement illustrates a growing trend: state DISCOMs delegating tender management to central agencies. NTPC Limited, India's largest power company, acted as the Renewable Energy Implementing Agency (REIA) — designing the tender, running the auction, and earning a Rs 0.07/unit trading margin on all power procured.

For state DISCOMs with limited renewable energy procurement expertise, the REIA model offers:

• Access to national-scale bidding: NTPC's brand and track record attract more bidders, driving down discovered tariffs
• Process credibility: Disputes over tender design or evaluation are less likely when a central agency runs the process
• Regulatory acceptance: CERC and state regulators are more likely to accept tariffs discovered through NTPC-led processes

SECI (Solar Energy Corporation of India) plays a similar role for other states. This ecosystem of central agency intermediaries has been a key driver of India's record-low solar tariff discovery in recent years.

Frequently Asked Questions

What tariff did MSEDCL's 1,600 MW solar procurement discover?

The landed tariff ranges from Rs 2.66 to Rs 2.72 per kWh, inclusive of a Rs 0.07 per unit trading margin for NTPC. The base tariff (before NTPC's margin) was in the Rs 2.59–2.65/kWh range. This is the rate MSEDCL will pay for this power over the 25-year PPA term.

When will this 1,600 MW solar power begin flowing to Maharashtra?

Power supply was scheduled to commence from June 30, 2026. PPAs are valid for 25 years from the commencement date, running to approximately 2051.

What is NTPC's role in this procurement — is NTPC generating the solar power?

No. NTPC acted as the Renewable Energy Implementing Agency (REIA) — it conducted the tender and auction process on MSEDCL's behalf. The actual solar plants will be built and owned by the four winning developers (JSW Renew, Anboto, Apraava, Avaada). NTPC earns a Rs 0.07/unit trading margin as a facilitation fee.

How does the Rs 2.66–2.72/kWh tariff compare to MSEDCL's current power costs?

MSEDCL's actual average power purchase cost was Rs 4.82/kWh for FY 2023–24. The solar tariff of Rs 2.66–2.72/kWh is approximately Rs 2.10–2.16/kWh cheaper — a very substantial cost saving that will reduce MSEDCL's average power purchase cost as more solar capacity comes online.

Does this procurement affect open-access solar charges for industrial consumers in Maharashtra?

Not directly in the short term. Open-access charges (cross-subsidy surcharge, wheeling charges, banking charges) are set by MERC through separate orders. However, as MSEDCL's average power purchase cost decreases through cheaper solar procurement, there is long-term regulatory pressure to rationalise cross-subsidy surcharges — which would benefit industrial open-access consumers.

Sources

• MERC Approves MSEDCL's 1,600 MW Solar Power Procurement At Competitive Tariffs — SolarQuarter (January 5, 2026)
• Gujarat Adopts Tariff of Rs 2.51/kWh for Procuring 860 MW of Solar Power — Mercom India
• Maharashtra Solar Policy — MSEDCL Net Metering and MAHAURJA