DEE Development Engineers' subsidiary gets tariff hike for biomass plant
DEE Development Engineers' subsidiary, MPPL, secured a new tariff of ₹5.224/kWh for its 6 MW biomass plant, a 49.3% increase from the interim ₹3.50/kWh. The company expects to recover ₹5.80 Crores retroactively. MPPL's biomass pellet plant will also commence operations, projecting combined revenues of ~₹47.71 Crores for FY27. The company may appeal for a higher tariff.
The tariff hike and additional revenue streams from the pellet plant will positively impact the subsidiary's financials. However, the company's intent to appeal for a higher tariff indicates potential for further upside but also introduces an element of uncertainty regarding the final tariff.
The new tariff determined by PSERC is substantially higher than the interim rate, leading to a positive financial impact and increased revenue projections. The upcoming operationalization of the biomass pellet plant further strengthens the positive outlook.
DEE Development Engineers Limited announced that its wholly owned subsidiary, M/s Malwa Power Pvt. Ltd. (MPPL), has received an order from the Punjab State Electricity Regulatory Commission (PSERC) determining a new tariff for its 6 MW biomass power plant.
The PSERC order, dated March 27, 2026, sets the tariff for the extended 10-year term of the plant, which began after its initial 20-year Power Purchase Agreement (PPA) expired on April 26, 2025. During the interim period from May 2025 to February 2026, the plant supplied electricity at an interim tariff of ₹3.50 per kWh. The new tariff determined by PSERC is ₹5.224 per kWh, representing an increase of approximately 49.3% and an additional ₹1.724 per kWh.
This tariff revision is expected to have a positive financial impact, with MPPL eligible to recover approximately ₹5.80 Crores for the electricity supplied at the lower interim rate. For FY 2026-27, the company projects an annual revenue of approximately ₹24.31 Crores from power generation based on the revised tariff and an estimated 85% Plant Load Factor (PLF).
Furthermore, MPPL's Biomass Pellet Plant, with a capacity of 72,000 MT per annum, is set to commence operations shortly. This plant is projected to generate an estimated revenue of approximately ₹1.95 Crores per month (~₹23.40 Crores per annum) at 50% operating capacity. Combined, MPPL anticipates a total estimated revenue of approximately ₹47.71 Crores for FY 2026-27.
The company's management believes the determined tariff, particularly the fixed cost component, is on the lower side and may not fully align with the latest CERC regulations. Consequently, DEE Development Engineers Limited is evaluating the option to file an appeal before the Appellate Tribunal for Electricity (APTEL) to seek an upward revision of the tariff.
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DEE Development Engineers Limited filed this with the NSE as a statutory disclosure, categorised under other regulatory filings. It is a primary document, not a recommendation, and the desk marks it medium impact: worth reading, rarely worth acting on by itself.
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