Post by VYQON Research Private Limited

Regulatory Order | UPERC Declares GST Cut on Renewable Equipment as 'Change in Law' PM-KUSUM C2 Projects; Benefits Pass to UPPCL Consumers; Supplementary PPAs Required The Uttar Pradesh Electricity Regulatory Commission (UPERC) has declared the reduction in GST on renewable energy devices and components from 12% to 5% as a 'Change in Law' event for projects implemented under the PM-KUSUM Component-C2 scheme, paving the way for lower tariffs and the pass-through of benefits to power consumers. Key details: → Suo motu order dated June 23, 2026; the GST reduction became effective September 22, 2025, and lowers the procurement cost of RE equipment, reducing overall capital cost of solar projects developed under the feeder-level solarisation programme → Bid submission cutoff: the last date for bid submission under the PM-KUSUM Component-C2 tender was January 9, 2025 well before the GST notification; UPERC observed that any financial benefit from the lower GST rate must be passed to the procurer (Uttar Pradesh Power Corporation ( Uppcl )) and ultimately to end consumers → Scale: the order pertains to procurement of 2,553.5 MW of grid-connected solar under PM-KUSUM Component-C2 through tariff-based competitive bidding; 566 substations (1,686.4 MW) have Letters of Award; 449 PPAs (1,355.5 MW) approved so far → Implementation: UPERC directed constitution of an expert committee for each DISCOM comprising UPNEDA, UPPCL, and the concerned DISCOM to assess project-wise GST reduction benefits based on documentary evidence including invoices, payment records, and auditor certificates; supplementary PPAs to be executed incorporating revised tariffs → National regulatory trend: UPERC's order follows CERC (April 2025), RERC (June 2026), APERC (June 2026), and multiple other state regulators in declaring the September 22, 2025 GST cut as a Change in Law, all guided by the Ministry of Power's April 16, 2026 recommendation for a uniform state regulator approach to pass through consumer benefits → KERC context: Earlier (Post 436), Karnataka HC had quashed KERC's captive status procedure; in a separate matter, Karnataka HC overturned ABB India's ₹120 crore GST demand on solar inverters as a 5% item consistent with the same GST rationalisation that UPERC is now recognising as a Change in Law event for RE PPAs 📌 Full article: https://lnkd.in/en8c7-4x UPNEDA Ministry of Power Govt of India #UPERC #UttarPradesh #ChangeInLaw #GST #PMKUSUM #SolarEnergy #RegulatoryOrder #TariffRevision