KERC proposes to lower the benchmark tariff for new solar projects in Karnataka

In light of declining tariffs in state tenders, the KERC has proposed a tariff of Rs 2.79 per kWh for new megawatt-scale grid-connected solar PV projects to be developed in the state. The proposed tariff is Rs 1.57 per kWh, less than KERC’s previous benchmark tariff of Rs 4.36 per kWh. In addition, KERC has proposed a tariff of Rs 3.27 per kWh without subsidies for rooftop solar PV projects having capacities ranging from 1 kW to 1,000 kW. The proposed rate is 41 per cent less than the earlier tariff of Rs 5.20 per kWh. Moreover, KERC has proposed reducing the interest charges on debt from 11 per cent to 9 per cent. There is also a reduction in the interest on working capital to 10 per cent for both kilowatt-scale and megawatt-scale projects. If accepted, the new benchmark tariffs would be applicable from April 1, 2018.