MERC denies Cleanmax’s plea to use Open Access and Net metering simultaneously

In a petition filed by Cleanmax Enviro Energy Solutions Pvt. Ltd., the organization had sought clarification regarding the net metering arrangements for Open Access consumers under the MERC regulations 2015 from the commission. As a part of the reply to the petition, according to the ruling by MERC, the generators cannot use both Open Access and net metering simultaneously. The regulatory commission also mentioned that benefits of net-metering are limited to the rooftop solar installations with capacity up to 1 MW only. The generators above 1 MW can avail Open Access.

The explanatory ruling came as a result of responding to a petition filed by Cleanmax Solar to grant net metering permission for a 991 kW rooftop solar photovoltaic (PV) project at Asahi India glass limited situated at MIDC – Taloja, Raigad Maharashtra. Asahi was a customer of MSEDCL with a contract demand of 7500 kVA connected at 100 kV. Asahi also availed partial open access at 3,000 kVA from traditional energy under a group captive arrangement from Sai Wardha Power Generation Limited. In 2017, Asahi made an application for Net Metering arrangement for the Rooftop Solar Photovoltaic system under the rooftop solar regulations 2015.

After listening to both the party’s petition the commission came to a decision that…

“Net metering and Open Access are two different sets of arrangements for different eligible consumers and its Regulatory framework also has been provided by the two different Regulations. If these two arrangements are mixed up then there are various issues related to Grid security, accounting, billing, settlement etc. Hence, the Commission has made Net Metering Regulations for “below 1 MW” and Open Access for “1 MW and above” and cannot avail simultaneously by same consumer”.

Hence denying Cleanmax’s plea.

One of the reasons for the commission to take this decision was their concern for grid security due to which the DISCOMs would have to go into distribution network contingencies and other related issues to Open Access and Net Metering Simultaneously.


In a recent Judgement, the Competition Commission of India (CCI) considered the case of an electricity consumer that was repeatedly denied open access permission. In this case, the consumer approached the CCI alleging “abuse of dominant position” on part of the state utilities. The case was filed by HPCL-Mittal Pipelines Limited (‘HMPL’) against denial of open access. In this case, “upstream network constraints” were cited to disallow OA application multiple times.


The CCI found that prima facie denial of open access in the above case did result in violation of Sec 4(2)(c) of the Competition Act 2002. This clause refers to “abuse of dominant position by denial of market access”. The CCI has ordered a detailed investigation in the matter.


The CCI also made certain other interesting observations in the case:


  1. In the above case, it identified “conflict of interests situation” between the various constituents of the electricity utilities like the Discom, TransCo, SLDC, etc due to “structural linkages”, i.e. common holding structure. The order states the following:

It appears that OP-2 has leveraged its dominant position in the relevant market to adversely affect the competition in the downstream market, where it is present through its group entity OP-3. The structural linkages between the OPs as depicted in the diagram illustrated earlier also points toward the conflict of interest that exists in the present case. Thus, given the conflict of interest situation that exists in the present case, anti-competitive motive behind such denial by OP-2 cannot be ruled out and may need to be tested in detailed investigation.


  1. The case dwells in depth on the jurisdiction of the CCI to rule on such cases given that the EA2003 is also a special statute that deals with all matters of electricity. The CCI finds that there are enough grounds and supporting case laws to justify its jurisdiction as far as competition related matters are concerned across all sectors.


This judgement is certainly a very interesting development for the electricity sector, as denial of open access permissions is a problem across most states. The inherent conflict of interest is evident, as often the Discom itself has to approve OA applications, in what will effectively result in taking away of its own best paying consumers.

The regulatory regime of the sector itself, especially the State Regulatory Commissions (SERCs) have so far taken a view that has supported the Discom’s, at the cost of the overall market and sector. Examples include setting of Cross-subsidy surcharges without regards to the formula and limits defined in the National Tariff Policies, upholding denial of open access in many cases, etc.


It is hoped that an outsider, for example CCI, which does not bring with it the baggage of the SERCs, or the “conflict of interest” that results from the government appointing the electricity regulator and owning the entire value chain, will catalyse real change in the electricity sector.


DERC has released an order determining the terms and conditions for open access charges for FY 2017-18. Following are the salient features of the order:


  • Eligibility: Short Term Open Access (STOA) is applicable to consumers having a contract demand of 1 MW and above connected at 11 kV or above.

  • Metering Arrangements: The distribution licensee shall provide check meters of the same specifications as the check meters. The distribution licensee shall provide ABT compliant special energy meters at the point of drawal. The formats for availing open access approvals have also been notified

  • The 60 day timeline has also been defined for the procurement, testing and installation of ABT meters.

Screenshot (244).png

The previous open access policy was announced in 2005. As of now, there are close to 60 clients in Delhi in Open Access which are trading power. As per the last policy, the quantum of energy traded had to be constant which is not the case anymore.

Earlier, an undertaking used to be taken in case of a mixed feeder which is still the case. Also, the SNAs asked for Bank Guarentee which included open accessed charges which is also still the case.

The order can be accessed here.

Himachal Pradesh Electricity Regulatory Commission Determines Additional Surcharge

HPERC in its recent order determined the Additional Surcharge on the consumers availing Short Term Open Access Consumers. The Commission earlier approved the rate of additional surcharge as 78paise/kWh in its order dated 18th Feb, 2016.

The HPSEBL has, vide the present petition, requested the Commission to approve the Additional Surcharge of 80 paise per unit for STOA.

After reviewing all the comments and suggestion from the stakeholders and objectors the commission deter-mines the Additional surcharge to be 49.16paise/kWh. The graph below depicts the change in additional sur-charge over the past three control periods :-

The regulation can be accessed here.


Gujarat Electricity Regulatory Commission determines Additional Surcharge for Open Access Consumers 2016-17

Gujarat Electricity Regulatory Commission (GERC) in its order dated 1st October 2016 has computed the additional surcharge payable by the Open Access Consumers for the control period of 1st October 2016 to 31st March 2017.

The order has come as per the GERC Open Access Regulation which states, that additional surcharge shall be determined in every 6 months periods.

The GUVNL (Gujarat Urja Vikas Nigam Limited) furnished the data to the commission as per the guidelines defined and proposed an additional surcharge of Rs. 0.44/kWh. The additional surcharge has decreased by Rs. 0.22/kWh from the previous surcharge.

The Additional Surcharge will be applicable to the consumers of MGVCL, UGVCL, PGVCL and DGVCL, who avail power through open access from any source other than their respective DISCOMs and will be applicable for the open access transaction commencing from 1st October, 2016 to 31th March, 2017. The graph below depicts how the addition surcharge has varied over the past:

The regulation can be accessed here.

TSERC Determines CSS for FY2016-17

Telangana Electricity Regulatory Commission (TSERC) has calculated the Cross subsidy surcharge to be applicable during FY 16-17. The new CSS will be applicable only for the state of Telangana effective from 1st July, 2016 to 31st March, 2017.  There was no CSS applicable in the state till last FY 14-15. The new CSS applicable will have significant impact on the open access power market.

The Telangana solar and wind policy which was announced recently clearly states that for Solar Power Plant located within the state and selling power to third parties within the state, 100% exemption shall be provided on the cross subsidy surcharge as determined by TSERC for five years from the date of commissioning of the Power Plant.

The table below depicts the CSS charges defined for year FY2015-16 and FY 2016-17:

The regulation can be accessed here.


GERC Determines Tariff for Procurement of Power from Wind Energy Projects

Gujarat Electricity Regulatory Commission (GERC) has proposed an increase in tariff for procurement of wind power. The higher tariff is on account of a rise in capital costs of setting up a wind power project in Gujarat.

GERC has come out with a draft discussion paper on tariff fixation and has invited stake holders to file objections before June 10, 2016. According to the draft paper, the capital cost of setting up a wind power project in Gujarat increased from Rs 6.06 crore per MW to Rs 6.13 crore per MW.

The graph below gives a comparison of the wind tariff determined over the few years:



Cross Subsidy Charges, Transmission and Wheeling Charges:

1.      Cross Subsidy Charges:

According to the earlier orders, the commission had exempted third party sale of wind energy from the cross subsidy surcharge. Also  the cross-subsidy surcharge all open access transactions from wind power projects.

  • 25% of the cross subsidy surcharge as applicable to normal open access consumer shall be applicable.

2. Wheeling of power for Captive Use

a. In Case of wheeling of power to consumption site at 66 kV voltage level and above, normal open access charges and losses as applicable to normal open access consumer.

b.  In case the injection of power is at 66 kV or above and drawl is at 11 kV, normal transmission charges and losses are applicable; however 50% of wheeling charges and 50% of distribution losses of the energy fed into the grid as applicable to normal open access consumers.


3.Wheeling of power to more than one locations

Wind power projects owners , who decide to wheel electricity for captive use / third party sale , to more than one location, shall pay 5 Paisa/KWh on energy fed in the grid to the distribution company concerned in addition to transmission charges and losses, as applicable.


4. Energy Metering

  • Wind projects shall have to provide ABT compliant meters at the interface points
  • Metering shall be done at interconnection point of the generator bus-bar with the transmission or distribution system concerned. Pricing of Reactive Power
  • 10 paise/kVARh– For the drawl of reactive energy at 10% or less of the net energy exported.
  • 25 paise/kVARh– For the drawl of reactive energy at more than 10% of the net active energy exported

5.Banking of Surplus Wind Energy

As promotional measure, it is proposed to continue the banking facility for 1 billing cycle for the wind power captive projects wheeling electricity for own use.

  • For captive wind energy projects, the surplus energy after one month’s banking is considered for purchase by distribution licensee at 85% of the wind tariff.
  • For third party wind energy sale, the surplus energy after 15 minutes time block is considered for purchase by distribution licensee at the rate of 85% of the tariff declared by the Commission. The order can be accessed here.

Odisha Declares Open Access Charges for 2014-15

Odisha Electricity Regulatory Commission (OERC) has determined the Open Access charges through a notification dated 11thApril 2016.

The new charges determined are applicable for FY 16-17 with effect from 11th April 2014. The details of the charges are in the table below:



The normative transmission loss at EHT (3.70%) and normative wheeling loss for HT level (8%) are applicable for the year 2016-17.

Additional Surcharge: No additional surcharge over and above the Cross-Subsidy Surcharge needs to be given to the embedded licensee.

No Cross-subsidy surcharge are payable by the consumers availing Renewable power.

20% wheeling charge is payable by the consumer drawing power from Renewable source excluding Co-generation & Bio mass power plant.

The order can be accessed here.



RERC determines Additional Surcharge for Open Access Consumers 2016-17

In the recent decision the Rajasthan High Court passed an order against RERC for the levy of Rs.1/kWh as Additional Surcharge on all Open Access Consumers.

On 12.05.2016 Rajasthan Electricity Regulatory commission passed an order for the levy of additional surcharge for all the Open Access consumers. This had negative Implication on any consumer willing to buy power from a third party in the state. The surcharge made all the Open Access transactions in the state highly unviable. Even the Green Power Transactions were not exempted from the surcharge.

In its verdict the High Court has “set aside” the verdict passed on 12.05.2016 and has provided directions to RERC to follow and obtain the desired information in a rightful and transparent manner.

The court has provided following direction to the State Regulatory Commission:

  • The RERC should make a public advertisement to notify the Objectors
  • The requisite advertisement to be made in two Vernacular and one English Newspaper
  • The advertisement will also notify the date of hearing within one week of the last date for collection of material as per advertisement.
  • RERC will hear the objectors and pass orders within ten days. The objectors will not be entitled to any adjournment.
  • The parties agree that the additional surcharge, if any, determined by RERC would be payable effective the date it was payable under the order dated 12.05.2016.
  • The current order has been occasioned only for reason of violation of principles of natural justice in passing the impugned order dated 12.05.2016 and is not reflective of the merits of the levy of additional surcharge or its quantu

The order can be accessed here.



MERC Distribution Open Access 2016

MERC (Maharashtra Electricity Regulatory Commission) has come up with the new distribution open access regulation 2016 on 30th March 2016 in the state of Maharashtra.

The key changes in the regulation are:

  1. Allowing sourcing of power from multiple sources.
  2. Allowing sourcing of power from power exchange.
  3. Day ahead open access- The application for grant of day ahead shall be made only 1 day prior to the date of scheduling (Before it was 2 day)
  4. Consumer shall install Special Energy Meter (SEM).
  5. The draft OA regulation had proposed that a consumer having Contract Demand of 500 kW and above will be eligible for OA. However, in the final regulation the existing limit of 1MW has been retained. Had MERC lowered the limit, it would have potentially resulted in a much larger OA market in Maharashtra.
  6. Banking of Renewable Energy is introduced-

6.1.             Credit of banked energy is not permitted during the months of   April, May, October & November.

6.2.           Credit of energy banked during other months is as per the energy injected in the respective TOD (Time of Day) slots.

6.3.           Energy Banked during peak TOD slots can be credited during off-peak TOD   slots whereas energy banked during off- peak TOD slots cannot be credited during peak TOD slots.


Illustration: Energy banked during:


  • Night off-peak TOD slot (2200 hrs. – 0600 hrs.) may only be drawn in the same TOD slot.
  • Off-peak TOD slot (0600 hrs. – 0900 hrs. & 1200 hrs. – 1800 hrs.) may be drawn in the same TOD slot and also during Night off-peak TOD slot.

(The energy banked during night off peak and off-peak shall not be drawn during morning peak and evening peak)

  • Morning peak TOD slot (0900hrs – 1200hrs) may be drawn in the same TOD slot and also during off-peak and Night off-peak TOD slots.
  • Evening peak TOD slot (1800hrs- 2200hrs) may be drawn in the same TOD slot and also during Off-peak and Night off-peak TOD slots.


Impact of the Regulation

MERC has proposed a progressive open access regulation. Consumers in Maharashtra has faced various problems in the past to avail the power through open access such as power from one source only, revision of contract demand and banking of renewable power.

Multiple sources will increase the competitiveness in the market and it will promote the open access. It will also help the renewable sector to boom in Maharashtra as the rate will become more competitive.

Banking of non-firm power will be a boon for the renewable sector mainly solar. As per the credit table depicted above, the generated units in the off-peak and morning peak time can be adjusted in the peak hours.

The regulation can be accessed here.

Go to top