The Uttar Pradesh Electricity Regulatory Commission has begun hearing UPPCL’s major thermal power procurement petition.
The matter is Petition No. 2338 of 2026.
UPPCL is seeking approval to procure 4,000 MW of thermal power capacity.
The capacity will come from new projects.
The procurement is proposed under the DBFOO model.
The tenure will be 25 years.
Procurement structure
DBFOO stands for Design, Build, Finance, Own and Operate.
Under this structure, the developer builds and operates the project.
UPPCL commits to long-term power purchase under a PPA.
Fuel is proposed to be sourced through the SHAKTI Policy B(iv) route.
This gives the procurement a structured coal-linkage framework.
Why this matters
Uttar Pradesh is India’s most populous state.
It is also one of the country’s largest electricity consumers.
The state has historically faced peak supply pressure.
A 4,000 MW thermal procurement would provide dedicated baseload capacity.
This is important as demand rises and renewable energy creates larger balancing needs.
Long-term commitment
The proposed 25-year tenure is significant.
It gives developers long-term revenue visibility.
It also locks UPPCL into a long-term tariff framework.
This can improve supply security but also creates a multi-decade cost obligation.
The regulator will therefore examine consumer interest carefully.
Interventions filed
JSW Energy has filed an intervention.
Lalitpur Power Generation Company Limited has also filed an intervention.
Both have raised objections to key bid conditions.
Their participation shows that the proposed procurement has sector-wide importance.
Key objections
The objections relate to three major bid conditions.
The first is the restriction to new projects only.
The second is the mandated 800 MW unit size.
The third is the 2,400 MW cap per bidder.
These conditions could affect the number of eligible bidders and the final tariff discovered.
New-project restriction
The restriction to new projects excludes existing plants or expansion opportunities.
Interveners may argue that existing or expansion-ready capacity could deliver power faster.
They may also argue that excluding such options reduces competition.
UPERC will need to assess whether UPPCL’s new-project-only condition is justified.
800 MW unit size
The mandatory 800 MW unit size is another important issue.
Large supercritical units can provide efficiency benefits.
However, this requirement may limit bidder participation.
Not all developers have access to projects that match this exact configuration.
The Commission will examine whether this condition supports efficiency or restricts competition.
2,400 MW bidder cap
The 2,400 MW cap per bidder is also under scrutiny.
Such a cap can prevent concentration of supply with one developer.
But it may also restrict scale benefits for large players.
The Commission will need to balance competition, supply security, and tariff efficiency.
Strategic message
UPPCL’s 4,000 MW DBFOO thermal procurement is one of India’s largest state-level baseload capacity initiatives in recent years.
The case will test how regulators balance long-term supply security, competitive bidding design, developer eligibility, and consumer tariff protection.
UPERC’s decision on JSW Energy and Lalitpur Power’s objections could shape future thermal procurement structures across other states.
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