Power Ministry Scraps Uniform Tariff, Eases Renewable Energy Expansion
The Indian power ministry has eliminated the uniform tariff mechanism for renewable energy, intending to simplify price discovery and speed up renewable energy deployment. The move dissolves central pricing pools, aiming to address concerns over tariff uncertainties and expedite power sales agreements for stalled renewable energy projects.
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- India
In a significant shift in policy, the Indian power ministry has discarded the uniform tariff mechanism, aiming to foster a more streamlined price discovery process for renewable energy transactions. This strategic modification seeks to enhance the deployment of renewable energy across the country.
Previously established pricing pools, namely the Solar Power Central Pool and the Solar-Wind Hybrid Central Pool, have been dissolved as the ministry recognizes the pressing need to address tariff uncertainties affecting power sale agreements between producers and procurers.
The decision follows widespread concerns within the renewable energy sector regarding stalled projects due to the lack of advanced power purchase agreements. This move is seen as crucial for meeting India's target of 500 GW in renewable energy capacity by 2030, while allowing existing bids under the former mechanism to remain valid.
(With inputs from agencies.)
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