Mumbai, Nov. 10 -- The Karnataka government has asked the Karnataka Electricity Regulatory Commission (KERC) to remove the ceiling on tariffs discovered through competitive bidding for renewable energy projects awarded under state bids. Gaurav Gupta, Additional Chief Secretary in the Energy Department, disclosed the request during an industry interaction at the Bharat Renewable Energy Summit 2026 in New Delhi.
Gupta said the government had written to the regulator after the tariff ceiling was raised as a concern during a panel discussion on renewable energy in Karnataka. He also indicated that the state had issued an advisory stating that no ceiling should be imposed on tariffs for bids floated by the government.
The tariff cap has been a longstanding concern among renewable energy developers. KERC initially set the ceiling at Rs. 3.10 per kWh, before raising it to Rs. 3.60 per kWh following representations from the industry. Developers contend that tariffs should be determined by market forces, as predetermined limits can restrict bidding and prevent projects from reflecting prevailing costs.
Karnataka plans to add 5 to 6 GW of renewable energy capacity annually until 2030. The state expects to add about 30 GW over the next five years and 41 GW over the next 10 years to its existing 28 GW capacity. Gupta said the 30 GW projection was based on investment roadmaps announced by companies and added that Karnataka aimed to attract Rs. 3 tn in investments over five years.
Divya Prabhu, Managing Director of Karnataka Renewable Energy Development Corporation (KREDL), said the state would soon issue a 600 MW tender for firm and dispatchable renewable energy. Karnataka is also planning a second solar park at Ryapte, following the 2 GW Pavagada project. The proposed park will include 2 GW of solar capacity and 1 GW of battery storage, with landowners voluntarily offering 8,000 acres for the project.
Published by HT Digital Content Services with permission from Construction World.