State-owned SJVN Ltd has inked two pacts with Punjab State Power Corporation Ltd (PSPCL) to supply 1,200 MW of solar power from its projects, Punjab Chief Minister Bhagwant Mann said here on Thursday.

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Satluj Jal Vidyut Nigam signed two power purchase agreements (PPAs) for 1,200 MW of solar power recently.

PSPCL had floated tenders for procurement of power from solar projects located in Punjab and other parts of the country.

SJVN Green Energy Limited (SGEL), SJVN's arm, proposed the rate of Rs 2.53 per unit for the supply of 1,000 MW and Rs 2.75 per unit for another 200 MW.

"Earlier bidding was of Rs 2.59 per unit but it was negotiated and brought at Rs 2.53," he said.

For 200 MW the bid had proposed the rate of Rs 2.79 per unit but it was finally agreed at Rs 2.75 per unit, Mann said, adding that the state government will save Rs 431 crore through this negotiation.

The rates have been fixed for 25 years and PSPCL will not pay any transmission charges for transmission losses.

Lashing out at previous governments, the chief minister said that from 2007-2017 none of the power supply pacts was below the rate of Rs 7 per unit.

Mann said Punjab will soon become the first state to implement the policy for banking power. "We are also going to implement the power banking policy soon," he added.

To further promote clean energy and provide maximum power to agricultural tube-wells, PSPCL has floated more tenders to procure 2,500 MW solar power, the chief minister said.

SJVN is already executing a 100-MW solar project at the cost of about Rs 545 crore in Punjab