The Southern Power Distribution Company of Telangana Limited (TGSPDCL) has submitted a petition to the Telangana Electricity Regulatory Commission (TGERC) to approve the procurement of 4,000 MW of decentralized, ground-mounted, grid-connected solar power. This initiative is part of Component-A of the Pradhan Mantri Kisan Urja Suraksha Evam Utthaan Mahabhiyan (PM KUSUM) Scheme. The proposed power purchase agreements will have a duration of 25 years from the date of commissioning.

TGSPDCL is taking this step to meet the rising energy demands of Telangana and to comply with the Renewable Purchase Obligations (RPO) set by the Ministry of Power (MOP). The company aims to secure this solar power through a tariff-based competitive bidding process, which is in line with the procurement guidelines issued by TGERC. While the guidelines typically require competitive bidding, TGERC has allowed for a pre-fixed levelized tariff under the PM KUSUM Scheme. As a result, the Telangana Green Energy Development Corporation Limited (TGREDCO) has released an Expression of Interest (EOI) for the 4000 MW procurement, with ₹3.13/kWh set as the ceiling tariff.

Telangana’s power needs are increasing steadily, and there are concerns about potential energy shortages in the future. In fact, the actual power purchase in the financial year 2023-24 has already exceeded the forecasted requirement for 2024-25. The Central Electricity Authority has also projected a continuous increase in power demand in the state. By procuring 4000 MW of solar energy, TGSPDCL plans to address this anticipated deficit, especially during high-demand periods such as the agricultural season.

Another important reason for this procurement is the requirement to meet renewable energy targets. Telangana’s current renewable capacity is not enough to fulfill the RPOs set by the Ministry of Power. Failure to meet these targets could lead to penalties. The proposed solar procurement will help the state meet its RPO obligations and also lower the cost of power purchase for the DISCOMs, as solar power is cheaper than the average cost of electricity currently being purchased.

Besides solar power, TGSPDCL and other power sector entities in Telangana are exploring additional renewable energy options and energy storage solutions. TGGENCO has already floated a tender for 250 MW of Battery Energy Storage Systems (BESS), which are essential for managing the intermittent nature of renewable energy and ensuring grid stability. The plan also involves integrating renewable power in a decentralized manner and coordinating operations between TGDISCOMs and TGGENCO.

While TGDISCOMs have already achieved the Renewable Power Purchase Obligation (RPPO) targets set by TGERC, they are also considering the broader RPO targets set by the Ministry of Power. These national-level targets are likely to increase in the coming years, so the state’s power distribution companies are planning ahead to remain compliant.

Overall, this large-scale solar power procurement plan is a strategic move by Telangana to ensure energy security, reduce costs, meet regulatory targets, and support clean energy development across the state.