We are delighted to present the third edition of the Solar Agri Bulletin. This bi-monthly publication by the Advisory Group on Solarizing Agricultural Power Demand serves as a gateway to key developments in India’s rapidly evolving solar power agricultural sector.

The edition features the latest state-level tenders and tariff orders on PM-KUSUM and updates on the Central Government’s domestic solar manufacturing initiative, including an insightful piece on reactive power compensation in renewable energy integration by Dr. Rachakonda Akshay.

Guest Column

Reactive Power Compensation: Strengthening grids for renewable energy integration

A seasoned power systems engineer, Dr. Akshay specializes in the development of grid-forming inverter technologies and recently conducted an in-depth session on reactive power management using grid-connected solar inverters for the consortium of the International Institute for Sustainable Development (IISD), the Council on Energy, Environment and Water (CEEW), and the Center for Study of Science, Technology and Policy (CSTEP).

Conventional  solar photovoltaic (PV) systems primarily deliver active power to the load and lack reactive power support, creating challenges for the grid, which must consistently meet the reactive power requirements. As the integration of renewable energy sources into distribution networks rises, reactive power management has become crucial. 

Dr. Rachakonda Akshay, Senior Design Engineer for Fimer India Private Limited, explains in this edition's guest column.

AC power system equipment is typically rated based on apparent power, which comprises both active and reactive power. Active power is the component that performs actual work, while reactive power oscillates in the network between source and load with no contribution to work and is stored and released by elements such as line inductance or capacitance. Although loads do not consume reactive power, maintaining it at a certain value in the grid is essential to establishing electromagnetic fields.

An inadequate supply of reactive power can result in voltage sag, i.e., bus voltage dropping below the nominal voltage rating or, in the worst cases, total voltage collapse. Conversely, excess reactive power increases the current in the network, leading to higher copper (I²R) losses and reducing the capacity of electrical equipment to do the active work.

To mitigate these challenges, reactive power is typically compensated locally. Inductive loads such as motors, heaters, and household appliances like refrigerators, air conditioners, washing machines, and electric vehicles inherently consume reactive power from the grid. To address this, distribution substations deploy capacitor banks, while transmission networks use technologies like Flexible Alternating Current Transmission Systems (FACTS) to act as local reactive power compensators. Generators also support reactive power within limits defined by their capability curves.

With the increasing integration of renewable energy sources like solar into power systems at the distribution level, reactive power management has become critical.

Conventional solar PV systems are designed to primarily deliver the active power demand to the load and lack reactive power support. This creates challenges, as the reactive power demand must be consistently delivered by the grid. While active power demand on the grid is reduced due to solar power plant generation, reactive power demand remains the same, potentially causing a voltage drop at the load end. If the voltage falls below the operational threshold of a solar PV system, it will switch off to protect itself, resulting in generation curtailment. This increases the load on the grid, further straining it, as it must stabilize the voltage and instantly supply additional active power to meet the demand.

Advancements in inverter technology have enabled some solar PV systems to provide both active and reactive power within manufacturer-specified limits. Modern inverters can provide reactive power control by various methods, both through fixed and variable reactive power compensation. A fixed reactive power compensation inverter behaves as a fixed capacitor or a fixed reactor, delivering consistent reactive power. Variable compensation dynamically adjusts reactive power based on grid voltage or grid active power levels as a reference, thereby improving grid stability and power flow.

These advanced inverters can also contribute to reactive power support during periods of low active power demand, such as the night hours. During night hours, when solar power is unavailable, the inverter can utilize its full apparent power capacity to maintain stable grid voltage.

The Central Electricity Authority (CEA) reported 28 incidents where inadequate reactive power support from renewable energy generators led to the loss of over 1,000 MW of generation. To address this, the CEA’s Technical Standards for Connectivity to the Grid – 2019, which introduced guidelines for minimum reactive power and Technical Standards for Connectivity to the Grid, Regulations by renewable energy developers – 2023, making it mandatory for renewable energy plants to comply with 2019 standards. Failing to do so can lead to disconnection.

As the rate of integration of decentralized, renewable energy sources rises, reactive power compensation will become increasingly vital in ensuring grid stability. Forward-thinking policy measures driven by robust regulatory frameworks and innovative inverter technologies will be crucial for the strategic implementation of reactive power compensation to support the smooth transition to a resilient renewable energy-powered grid.

Sectoral Developments

State-Level Updates

1. The Gujarat Electricity Regulatory Commission approved the adoption of levelized tariffs discovered through competitive bidding by state power distribution companies (discoms) for multiple solar projects under Component C – Feeder Level Solarization (FLS) of PM-KUSUM and allowed for the signing of Power Purchase Agreements with the successful bidders. The details of the orders are as follows:
   • Order dated October 29, 2024: levelized tariffs in the range of INR 2.35 to INR 3.00/unit, discovered by Paschim Gujarat Vij Company Limited (PGVCL), were approved for 101 solar power plants aggregating to 259.0 MW of capacity.
   • Order dated December 6, 2024: levelized tariffs in the range of INR 2.74 to INR 2.94/unit, discovered by Uttar Gujarat Vij Company Limited (UGVCL), were approved for 10 solar power projects aggregating to 41.0 MW of capacity.
2. Punjab State Electricity Regulatory Commission (PSERC), vide order dated December 12, 2024, approved a levelized tariff of INR 2.38/unit for 4 MW for 66 solar projects, aggregating 264 MW at the 11 kV side of substations of Punjab State Power Corporation Limited (PSPCL) under Component C (FLS) of PM-KUSUM. The tariff was discovered through competitive bidding conducted by the Punjab Energy Development Agency with M/S. VP Solar Generation Pvt. Ltd emerging as the lowest (L1) bidder.
3. The three power distribution companies in Rajasthan issued multiple tenders in October and December 2024 under Component A of the PM-KUSUM scheme for aggregate capacity exceeding 1 GW at a pre-fixed levelized tariff of INR 3.04/unit. The tender details are given below:
   • Ajmer Vidyut Vitran Nigam Limited, dated October 30, 2024, for 269.0 MW
   • Jaipur Vidyut Vitran Nigam Limited, dated October 30, 2024, for 287.7 MW
   • Jodhpur Vidyut Vitran Nigam Limited, dated October 30, 2024, for 335.0 MW
   • Ajmer Vidyut Vitran Nigam Limited, dated December 13, 2024, for 68.0 MW
   • Jaipur Vidyut Vitran Nigam Limited, dated December 13, 2024, for 49.3 MW
   • Jaipur Vidyut Vitran Nigam Limited, dated December 13, 2024, for 12.9 MW
   • Jodhpur Vidyut Vitran Nigam Limited, dated December 13, 2024, for 43.8 MW
4. In December 2024, Rajasthan also tendered multiple solar projects under Component C (FLS) of the PM-KUSUM scheme. The details of the tenders are given below:
   • Ajmer Vidyut Vitran Nigam Limited, dated December 13, 2024, for 94.1 MW
   • Jaipur Vidyut Vitran Nigam Limited, dated December 4, 2024, for 26.8 MW
   • Jodhpur Vidyut Vitran Nigam Limited, dated December 15, 2024, for 513.5 MW
5. Underscoring its commitment to exceeding the mandated agricultural solarization targets beyond PM-KUSUM, Rajasthan has adopted a novel strategy for solarizing its agricultural feeders. All three discoms have invited applications under a single stage-three envelope bidding process, which implies a single agreement covering the following interlinked activities:
   Distribution Infrastructure Development: Segregation of 11 kV mixed feeders under the Revamped Distribution Sector Scheme on a turnkey basis.
   Decentralized Solar Power Plant Development: Construction of solar plants near 33/11 kV substations under the Hybrid Annuity Model, along with operations and maintenance for 10 years.
   Network Management: Overseeing the 33/11 kV substation and its downstream network for a period of 10 years.
   
   The three distribution companies have already issued tenders detailing the scope of all activities, which are detailed below:
   • Ajmer Vidyut Vitran Nigam Limited, dated December 13, 2024, for 1,635.0 MW
   • Jaipur Vidyut Vitran Nigam Limited, dated December 13, 2024, for 1,102.3 MW
   • Jodhpur Vidyut Vitran Nigam Limited, dated December 13, 2024, for 1,429.38 MW
6. The Bihar State Power Generation Co. Ltd. (BSPGCL), in September 2024, invited applications through tariff-based competitive bidding at various locations across the state under PM KUSUM scheme Component C (FLS). In addition to the Central Financial Assistance (CFA) available for feeder solarization, the Government of Bihar is providing an additional subsidy of up to INR 45 lakh/MW for these projects.
7. OREDA Limited, the state nodal agency for Odisha, invited applications from vendors this month for the installation of 10,000 solar pumps under Component B of the PM-KUSUM scheme.
8. Dakshin Haryana Bijli Vitran Nigam Limited (DHBVN) invited applications in October 2024 for an aggregate capacity of 26.75 MW under Component A of the PM-KUSUM scheme.

National Updates

1. In a key amendment to the Approved List of Models and Manufacturers (ALMM), the Ministry of New and Renewable Energy (MNRE) introduced ALMM List-II for solar PV cells, effective starting June 1, 2026. This new list addresses the absence of a prior domestic supply framework for solar cells, which was constrained by limited production capacity. With anticipated growth in cell manufacturing capacity, this amendment aims to strengthen India’s domestic solar PV supply chain. Under the updated framework, all solar PV modules used in government-supported projects, net-metering systems, and open-access renewable energy projects must source their cells from ALMM List-II. However, projects already bid before this amendment’s issuance are exempt, even if commissioned after June 2026. Additionally, the amendment also includes provisions for thin-film solar modules.
2. The MNRE updated List I (Manufacturers and Models of Solar PV Modules) of its ALMM Order-2019 on December 26, 2024. The total enlisted module manufacturing capacity now stands at 63,027 MW.
3. Telangana released the Telangana Clean and Green Energy Policy, 2025 this month, which will remain active for the next 10 years. The policy outlines Telangana’s ambition to enhance its renewable energy capacity and also lists the incentives proposed by the state for the development of clean energy projects. The state aims to promote solar projects with capacities between 500 kW and 2 MW that are set up by women’s self-help groups (SHG) under this policy, for which the state energy and rural development departments have reached an agreement.
4. The Valedictory Ceremony of the 100 capacity-building workshops under PM-KUSUM Component A was held on December 7 in Goa. The event marked the culmination of workshops conducted across India and was attended by the Honorable Minister of State for New & Renewable Energy and Power, Shri Shripad Yesso Naik; the Honorable Minister of New & Renewable Energy, Goa, Shri Sudin Dhavalikar; and Joint Secretary, MNRE, Shri Ajay Yadav. These workshops, organized in collaboration with GIZ India, the Indo-German Energy Forum (IGEF-SO), and the Indian Council of Agricultural Research through Krishi Vigyan Kendras, focused on farmers’ outreach and engagement to promote agri-solar solutions. The workshops aimed to raise awareness about the PM-KUSUM scheme and empower farmers with sustainable energy knowledge to contribute to India’s clean energy transition.