Firm Matters

Khaitan & Co successfully represented Noida Power Company Ltd (NPCL) before the Uttar Pradesh Electricity Regulatory Commission (UPERC) in securing approval for the long-term procurement of 300 MW of firm and dispatchable renewable energy round-the-clock (RE-RTC) power through tariff-based competitive bidding.

UPERC approved the procurement for a period of 25 (twenty-five) years, along with key deviations proposed by NPCL from the applicable Bidding Guidelines and Request for Selection (RfS), to facilitate the procurement process. The approved deviations include: 

• Allocation of entire capacity to a single bidder: UPERC permitted allocation of the full 300 MW to a single successful bidder, subject to allocation at the lowest discovered tariff (L1 tariff), failing which bucket filling is to be undertaken within the range of L1 plus 2%. 
• Connectivity-linked eligibility: UPERC permitted NPCL to restrict RfS eligibility to bidders holding a final grant of connectivity from the Central or State Transmission Utility, as applicable, at the time of bid submission, with a connectivity commencement date on or before 31.12.2028. 
• Third-party tie-up for storage: UPERC permitted bidders to meet the Energy Storage System (ESS) requirement either as part of their own project or through a third-party tie-up, provided the bidder remained fully responsible for availability, scheduling and penalties under the Power Purchase Agreement.
• Aggregate financial threshold for consortiums: UPERC approved assessment of the financial capability of consortium bidders on an aggregate basis, rather than in proportion to each member's equity commitment, enabling entities with complementary strengths to jointly participate while meeting the overall financial threshold.

The Order is significant as one of the few instances of a state regulatory commission approving large-scale, long-term procurement of firm and dispatchable RE-RTC power through competitive bidding, along with tailored deviations to the standard bidding framework. By permitting single-bidder allocation, flexible storage tie-ups and aggregate assessment of consortium financial capability, UPERC has provided a template for structuring Firm and Dispatchable Renewable Energy (FDRE) procurements that balances commercial viability for bidders with the need to secure reliable round-the-clock renewable power. The Order is likely to serve as a useful precedent for other distribution licensees seeking similar deviations in their RE-RTC procurement processes.