⚡ Quick Read
- What happened: The Maharashtra Electricity Regulatory Commission (MERC) has set a generic tariff of ₹2.82/kWh for surplus rooftop solar power for FY 2026-27.
- Why it matters: This provides regulatory certainty for C&I and residential consumers regarding the compensation for surplus energy injected into the grid, maintaining consistency with previous years.
- Watch: Future shifts toward competitive bidding for rooftop solar procurement as distribution licensees scale up capacity and grid management requirements.
Background and Context
The Maharashtra Electricity Regulatory Commission (MERC) has issued a directive establishing the generic tariff for surplus rooftop solar power for the financial year 2026-27. Alongside this, the Commission determined variable charges for biomass and non-fossil fuel-based co-generation projects. These rates, effective from April 1, 2026, serve as the benchmark for energy injected into the grid by prosumers under net metering and net billing arrangements.
Key Details
The approved generic tariff for surplus rooftop solar power is ₹2.82/kWh. For other renewable sources, the Commission set variable charges at ₹6.85/kWh for biomass projects and ₹5.29/kWh for co-generation projects. These figures remain largely stable compared to the previous fiscal year, with biomass charges seeing a marginal reduction of 0.3% from the previous ₹6.87/kWh.
The Commission maintained its stance that rooftop solar is primarily intended for self-consumption. Consequently, it rejected stakeholder requests to link surplus compensation to retail tariffs or the Average Power Purchase Cost (APPC), noting that higher procurement rates would unnecessarily inflate the power purchase burden on distribution licensees (DISCOMs).
MSEDCL, the state’s primary distribution utility, reported that rooftop solar capacity in Maharashtra has reached approximately 5.1 GW across 687,000 consumers, resulting in an annual surplus injection of roughly 300 million units. While MSEDCL highlighted lower discovered tariffs in other contexts, the Commission clarified that only adopted tariffs are considered for regulatory benchmarking.
What This Means for EPCs and Developers
For EPC contractors and developers operating in the Maharashtra rooftop solar market, this order provides a clear financial framework for project feasibility studies. By maintaining the ₹2.82/kWh rate, the regulator has ensured that the economics of rooftop installations remain predictable. Developers can continue to pitch projects based on self-consumption models, knowing that the surplus injection compensation is locked in for the upcoming fiscal year. The rejection of higher compensation models emphasizes that the business case for solar in Maharashtra must continue to be built on reducing the consumer’s high-cost grid dependency rather than relying on feed-in tariffs.
What Happens Next
The Commission has reiterated that under the MERC (Renewable Energy Tariff) Regulations, 2019, the long-term goal remains the transition toward competitive bidding for renewable energy procurement. As rooftop solar penetration continues to grow—currently at 5.1 GW—the industry should monitor how MSEDCL manages grid integration and whether the state eventually moves to a competitive bidding process for surplus procurement, which could lead to more volatile or lower tariff discovery in the future.
