Rajasthan Proposes Wind Tariff for FY 15-16

The Rajasthan Electricity Regulatory Commission (RERC) on 20th March has proposed new tariff for wind energy sources, which will be applicable for the projects commissioned during FY 15-16. The commission has invited comments and suggestions from interested parties by 20th April 2015. The tariff will be applicable for 25 years.  The details of the tariff proposed is in the table below:

Below are the some graphs on the year-wise tariff’s of CERC and RERC for wind energy and the % changes in the tariff’s over the years.

Note: All figures of CERC relate to wind zone-2 as defined by CERC, and all RERC tariffs relate to Wind Power Plants located in districts other than Jaisalmer, Jodhpur & Barmer districts.

It can be noticed from the graphs above that RERC has constantly increased Wind tariffs over the last three FYs, while CERC wind tariffs have risen more in terms of % whereas that proposed for FY 2015-16 has been reduced compared to previous FY.

Rajasthan has a wind power potential of 5050 MW’s and with these tariffs proposed, it will become an attractive destination for setting up Wind projects.

The Tariff proposed by RERC can be read here.

Our previous post on RERC Net Metering Regulation can be read here.

Rec Trade Results March 2015

We are pleased to share the Result of REC trading for the month of March-15.

  • Solar RECs – Overall market clearance remained optimistic this time, with good demand at PXIL and overall good clearance at both the exchanges. Demand rose from close to 44,869 last month to 68,982 this time, albeit the huge inventory still left to be carried over to the next FY. Market clearing ration also improved significantly over previous month, but not convincing as compared to March 2014, where the clearing ratio was 7.37%.
  • Non Solar REC market unexpectedly dipped from 747,487 last month to 654,985 RECs this month due to some states allowing carry forward of RECs to next FY. The clearing ratio was good, but considering that in March last year it was 12.03%, it was significantly lower. Inventory continues to pile up, and has reached an overwhelming figure of close to 10.5 million.

Comparing trading volumes this quarter with the corresponding quarter last year provide a better picture of the REC markets. In the last quarter of FY 2013-14 approximately 13.5 Lakh REC’s were redeemed whereas this quarter of FY 2014-15, approximately 20 Lakh REC’s have been redeemed  – an increase of approx. 48 %.

The REC trade results in the FY 2014-15 is summarized below for your reference.

Non-Solar RECs


Solar RECs


REConnect Energy is the market leader in the REC Market in India, with 36% market share and a portfolio of over 3 GW RE. We have been recently acknowledged with the REC Trader of the Year 2014.

Team REConnect

UPERC Final Solar Rooftop Regulation, 2015

The Uttar Pradesh Electricity Regulatory Commission (UPERC) on 20th March has notified the finalized version of the regulation for solar grid interactive systems. The regulation will allow the consumer to install solar rooftop systems under net metering or gross metering arrangements, third party systems has also been allowed.

Key Points of the regulation

  • The system to be installed by any consumer should be of minimum 1 kwp capacity.
  • The max. peak capacity of the system being installed by a consumer shall not be more than 100% contracted demand of the consumer.
  • Consumers claiming  accelerated depreciation benefits on the rooftop solar PV system will only be allowed to avail net metering arrangement.
  • The third party owner will only be allowed to install such systems under the gross metering arrangement.
  • Under gross metering scheme the consumer must inject entire power generate into the grid, while Net metering allows the consumer to consume the power generated and feed the surplus power generated into the grid.
  • For the gross metering scheme the system owner will be provided preferential tariff for the power injected into the grid, while in case of net metering scheme the consumer will be provided with Rs. 0.50 per unit for the power injected into the grid after settlement.
  • The solar rooftop systems installed by any consumer or third party owner will be exempted from payment of wheeling and cross subsidy surcharge.

Solar Renewable Purchase Obligation –

The quantum electricity generated by consumer will be considered towards the RPO of the distribution licensee if the consumer is not an obligated entity, otherwise will be considered towards RPO of consumer or third party system owner.

Eligibility for Renewable Energy Certificate Mechanism (REC) –

The eligibility for Renewable Energy Certificate and issuance of such REC will be as per the eligibility criteria specified under CERC REC Regulation 2010.

The regulation can be accessed here.

Our previous blog on UPERC Draft Net Metering Regulation can be read here.

JERC Grid Connected Solar Power Regulation 2015

Joint Electricity Regulatory Commission (for the State of Goa and Union Territories) has notified the new regulation for Grid connected Solar Power projects to promote the development of Solar Energy. This regulations will apply only to the Grid Connected Solar Power Projects, whether Ground Mounted or Rooftop mounted, and will be applicable to the grid connected solar PV and solar thermal projects.

Key Points of the regulation –

  • Solar PV and or Solar Thermal power projects of capacity equal to or more than 500 kWp, and Rooftop projects of capacity equal to or more than 1 kWp but not more than 500 kWp, higher capacity can be allowed by licensee under stable system condition.
  • Consumers can opt either Net metering scheme or gross metering scheme.
  • Open access is allowed for third party owned projects  generating Solar Power Units.
  • The regulation will remain in force for three years.
  • The solar power generators  has been be exempted from charges in respect of electricity banking, wheeling, line losses and cross subsidy to the extent of Energy produced.
  • Consumer can avail the options of either settling excess energy at preferential tariff at the end of each billing cycle or carrying it forward until the end of the settlement period.

Solar RPO Applicability

  • Net Metered or Gross Metered Consumer: All energy produced by the solar project (self consumption and excess) shall be accounted towards RPO of the Discom.
  • Open Access Consumer: In case the consumer is an OA consumer and also a generator of Solar power, then the quantum of energy generated by the project will be accounted towards his own RPO.

Eligibility for REC’s

  • Net-metering injection is not eligible for REC.
  • Sale of power to Discom at APPC will be eligible for REC, as per CERC REC regulation 2010 and JERC regulations.

The regulation can be read here.

MNRE Draft guidelines for 2000 MW Solar projects Under VGF scheme

Ministry of New and Renewable Energy (MNRE) has notified the draft guidelines for the development of 2000MW of solar projects. The Solar Projects of 2000 MW Capacity under the State Specific VGF Scheme will be set up in the Solar Parks of various states, to be developed through coordinated efforts of Central and State Agencies.

This scheme envisages providing Viability Gap Funding through SECI to the bidders selected through a transparent bidding process to procure solar power at a pre-determined fixed tariff.

The main highlights of the draft guidelines are given in the points below:

  • Out of the total capacity of 2000 MW, a capacity of 250 MW will be earmarked for bidding with Domestic Content Requirement (DCR).
  • The levelized tariff for the term of the Power Purchase Agreement will be Rs. 5.79/kWh.
  • The bidders will be free to avail fiscal incentives like Accelerated Depreciation, Concessional Customs and Excise Duties, Tax Holidays, etc.
  • The upper limit for VGF is kept at Rs.1.0 Cr/MW for open category (Rs. 1.31 Cr/MW for projects in DCR category).
  • Solar Energy Corporation of India (SECI) will be the nodal agency for implementation of this Scheme. A fund handling charge @1% of the total VGF disbursed shall be payable to SECI out of the sanctioned VGF.
  • The Entire tendered quantity can be located in the Solar Parks in the State(announced by govt.) or Part of the quantity can be located in Solar Park and part outside Solar Park or Entire quantity can be located outside the Solar Park.
  • The minimum project capacity under this scheme will be 10 MW.
  • SECI will purchase power generated at the pre-determined tariff and sell the power to willing State Utilities under 25 years agreement at the applicable tariff after including a Trading Margin of Paisa Seven (7) per kWh.
  • The procedure for conducting e-bidding and e-auctioning shall be framed by SECI.

It is good to note that promotional VGF is proposed for projects procuring domestic PV panels. The proposed PPA rate of 5.79 clubbed with VGF is an attractive proposition considering the drop in solar module prices in the recent years. However, the DCR could be raised to 500 MW to encourage foreign players to setup manufacturing facilities in the solar parks proposed in AP and other states, on the lines of ‘Make in India’ mantra of the central government.

Details can accessed here.

Our Previous blog on MNRE scheme for development of solar parks can be read here.

REConnect unveils Clickpower.in

The long wait is finally over, and we are looking at an innovative Green Energy market product that is not only comprehensive and transparent, but also flexible and user-friendly at the same time.

Yes, we are talking about Clickpower.in : India’s First Green Energy Marketplace, and this says it all. We need not talk much here, but would like you to explore this new market at:

For details and guidance call: +91 8088732732

Media Coverage:  Economic Times

Ideas and Technology have merged to make this possible, thanks to our Directors and our IT Team for their continued perseverance towards making this a first of its kind solution for all your Power requirements.

We sincerely thank all our well-wishers for supporting us throughout in this journey of ours, and would love to have your continued support in making this a success.

Team REConnect

Meghalaya finalizes New RPO regulation 2015

Meghalaya State Electricity Regulatory Commission (MSERC) on 12th March has finalized its new regulation for renewable Purchase Obligation (RPO). The regulation will be called as MSERC (Renewable Energy Purchase Obligation & its compliance) Regulations, 2015.

The regulations will come into force from the date of their publication In the Official Gazette and will remain operative until it is revised. The minimum quantum of RPO (in %) defined under the regulation are in the graphs below:


The previous RPO regulation of the state gave RPO till FY 12-13 only after that the same was being considered for FY 13-14 & FY 14-15 as there was no RPO defined. The RPO target of the commission for FY 12-13 was only 1% (Wind 0.20, Solar % 0.4 % and others 0.4 %).

As can be seen from the graphs above, the total RPO target for the defined period is nowhere close to the NAPCC targets, and even the targets defined for Solar RPO are significantly lower than the National Tariff Policy (NTP) 2006 Solar targets. The low RPO targets are due to the fact that the NE states do not have significant RE potential, and due to low retail tariffs in the states, higher RPO may have significant impact on retail tariffs.

The Relevant order can be accessed here.

our previous post on Meghalaya Draft Net Metering regulation can be read here.


Punjab notifies Draft for amendment in RPO regulation

Punjab state Electricity regulatory Commission (PSERC) has notified a draft along with a staff paper for amendment in RPO regulation. Through public notice the commission has invited comments and suggestions on or before 20th March 2015.

The new regulation proposes RPO obligation of 7.0% (4.5% Non-solar & 2.5% Solar) by 2019-20. The details of the proposed targets (in %) are mentioned in the graphs below:


Punjab is among those few states that have taken strict action on RPO compliance by imposing heavy penalties on obligated entities, albeit most other states have allowed Discoms to carry forward their RPO to next FY. As can be seen from the graphs above, the state has proposed ambitious targets for Solar, which will meet the National Tariff Policy (NTP) 2006 Solar target set for 2019-20, albeit proposed Non-Solar targets are much lower. The proposed total RPO targets are also significantly lower than the targets set by NAPCC.

Apart from this the commission has also proposed some changes in the amendment. The commission has proposed new definition for the “obligated entity” which can be read as:

‘obligated entity’ means the ‘distribution licensee(s)’, ‘captive user(s)’ of the electricity generated in a Captive Generating Plant and ‘Open access customer(s)’ which are mandated under clause (e) of sub-section (1) of Section 86 of the Act to fulfill the renewable purchase obligation;”

Previous definition by the commission, did not include any consumer or licensee.

The draft can be accessed here.

The stern order given by PSERC on pending RPO of PSPCL can be read here.

Analysis of Gujarat High Court judgment on co-generation and RPO

On 12th March, 2015, The Gujarat High Court gave its judgment in the case of Hindalco (Birla Copper), and others. This is a landmark judgment for two reasons:

–          It says that CPP and open access (OA) consumers are liable to fulfill RPO

–          It holds that the ApTel’s conclusion that co-generation power is different from renewable power as held in the case of Lloyds Metal & Energy prevails over the earlier decisions as the Lloyds Metal case we delivered by a full bench. It held that the pervious judgments on this matter (Century rayon, and various others) have “no significance and force of law in view of judgment dated 02.12.2013 rendered by the Full Bench of the APTEL”.

Applicability of RPO on CPP and OA:

The Gujarat HC has considered various aspects and submissions on this topic. It has held that captive generation, while de-licensed activity, does not make a CPP outside the preview of the Electricity Act.

It also held that RPO regulations, made with the intent of greater social good, are applicable on “total consumption by all modes”. The judgment says:

“The fact remains that the area would always be of distribution licensee as the transmission lines and the system is of distribution licensee and, therefore, the phrase ‘total consumption’ is seen by consumers of distribution licensee, captive power plants and on supply through distribution licensee. Thus, the total consumption in the area of distribution licensee would be total consumption in all modes, otherwise serious consequences would follow.”(emphasis added)

In the above findings, the Gujarat HC is in line with the judgment earlier of the Rajasthan HC. In fact, that judgment has been relied upon to a great degree.

 On co-generation 

On the question of co-generation power being exempt from RPO as per the ruling of ApTel, the court has observed the following:

“That contention of Mr. S.N.Soparkar that co- generation plant of petitioners of Special Civil Application No.791 of 2011 that it is based on fossil fuel and is non-conventional in view of decision in the case of Lloyds Metal & Energy Ltd. [supra] of APTEL, though appears to be attractive on first blush but non-conventional energy cannot be equated always with renewable source of energy.”


“….. co-generation provided under Section 86(1)(e) of the Act, 2003 is not co-generation stand alone, but it is co-generation and generation of electricity from renewable sources of energy. Thus, a source or input of energy may be non-conventional in the sense that CGP or co- generation following innovative or advanced technology, which may be eco-friendly and reducing carbon credit, but only on that ground is not not the same renewable source of energy like hydro, wind, solar, biomass, bagasse, etc. That non-conventional energy always and for all purposes cannot be equated with non-renewable sources of energy.” (emphasis added)

The HC further added that the most recent judgment of the ApTel on the issue of RPO applicability on co-gen power – in the case of Lloyds Metal and Energy – prevails as it was rendered by the full bench of the ApTel, and therefore:

“Thus, judgment dated 26.04.2010 in Century Rayon [supra] [Appeal No.57 of 209]; judgment dated 17.04.2013 in IA 262 of 2012 in RP (DFR) No.1311 of 2012 in Appeal NO.57 of 2009 filed by Gujarat Electricity Regulatory Commission; judgment dated 30.01.2013 in Appeal No.54 of 2012 filed by M/s. Emami Paper Mills; judgment dated 31.01.2013 in Appeal no.59 of 2012 filed by M/s. Vedanta Aluminium Ltd. [VA]; and judgment dated 10.04.2013 in Appeal NO.125 of 2012 filed by M/s. Hindalco Industries Limited, all delivered by the APTEL have no significance and force of law in view of judgment dated 02.12.2013 rendered by the Full Bench of the APTEL in Appeal No. 53 of 2012.” (emphasis added)

Impact of the judgment

 The judgment is likely to have significant impact in many ways. Some key impacts are:

–          RPO applicability on CPP and OA in Gujarat – As of now, the RPO regulations of Gujarat are not notified with respect to CPP and OA. This was due to the pending court case. Now that the judgment is delivered, these regulations are likely to be made applicable to CPP and OA.

–          While the petitioners have the option to approach the Supreme Court, in our opinion this is likely to have minimal impact. This is because in a very similar case of the judgment of the Rajasthan HC, the Supreme Court has refused to give a stay on the judgment.

–          The judgment with respect to RPO on co-generation power is also likely to have far-reaching impact, as it clearly establishes the view that RPO can be made applicable on co-generation power. The court has held that as per Sec 86(1)(e) of the Electricity Act, co-generation should not be considered “stand-alone” because only on the basis of being co-gen it is “not the same as renewable sources of energy”

Our previous blog post on Rajasthan HC order for RPO enforcement can be read here.

And a previous post on ApTel order for Lloyd metals & Energy (RPO Petition) can be read here.

Analysis of net-metering regulation of Rajasthan

Key points of the Regulation:

Rajasthan came out with the final net-metering regulation on 26 Feb 2015. The below are key points of the regulation:

• Net-metering permission to be provided on a first-cum-first-serve basis by the distribution licensee. Overall capacity to be limited to 30% of the capacity of the distribution transformer.
• Maximum capacity of the plant will be 80% of the contract demand of the consumer.
• Minimum size of the plant – 1kwp, maximum – 1000 kwp.
• Time bound approval process by the Discom.

Energy accounting related points:

• Consumer will get credit for energy injected into the grid for the billing period
• If electricity injected exceeds the units consumed in the month, credit  will be carried forward to next period to the extent of 50 units (the draft  regulation had allowed a full carry forward to the next month).
• Excess units (>50 units) will be paid for at the rate set by RERC (currently Rs 6.631) by the Discom.
• The plant will be exempt from banking, wheeling and cross-subsidy charges. This will encourage the model of third-party ownership of the plant.
• A bi-directional/ net-meter will be required to be installed. Those with ABT meters already installed will not be required to install a net-meter

Issues for consideration:

1. Clarity on Solar RPO fulfillment by an obligated entity through net-metered solar PV project:

The policy is not absolutely clear on the ability of an obligated entity to meet its solar RPO through generation of rooftop solar. The policy says: “The quantum of electricity generated from the Rooftop PV Solar Power Plant under net metering arrangement by an Eligible Consumer, who is not defined as obligated entity, shall qualify towards compliance of Renewable Purchase Obligation (RPO) for the distribution licensee in whose area of the supply the Eligible Consumer is located.” (emphasis supplied)

Thus, the Discom can meet its solar RPO through entire generation from a net-metering plant, when the consumer is not an obligated entity. Since, for an obligated entity the Discom will not be able to use the power generated for RPO offset, it implies that the obligated entity will be able to use it. However, the regulation does not expressly state so.

Can an obligated entity avail RPO benefit by installing a net-metered solar PV project?

In our opinion, the answer is a qualified ‘yes’.

The draft regulation allowed the entire generation from the plant to be adjusted against the consumption by carrying forward such excess  (without any limit) to the next months.  However, the final regulation allows carry forward to next month only to the extent of 50 units. The excess is paid for by the Discom at the preferential tariff. This will make claiming RPO offset difficult as when the Discom pays preferential tariff, it will be allowed to use such power to meet its RPO.

Thus, an obligated entity will only be able to meet its RPO to the extent of offset available against its consumption, not on the excess for which received preferential tariff.

It is worth noting that the ability of claiming RPO offsets is not expressly mentioned in this regulation – instead it is mentioned in the  RPO regulation (2nd Amendment) as an observation by the commission:

Treatment for Roof Top/Land mounted solar plants in consumer premises: 

10. The Commission observes that no new provision as suggested by the stakeholders is required in the regulations since any RE power produced by captive RE source for own consumption or taken through open access is considered towards fulfillment of their RPO…..

However, the energy accounting methodology will be complex (because of the change where only a limited carry forward is allowed).
In our opinion, the best course of action for an obligated entity is likely to be to build capacity well within its consumption requirements on a monthly basis, so that the situation of carry forward does not arise.

2. REC eligibility for a net-metered solar plant:

The draft regulation contained a clause that allowed RECs as per CERC REC regulations. However, in the final regulation such a clause has been removed. Thus, it appears that net-metered plants will not be eligible for RECs.

The RERC final regulation is available here.

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