Blog by Team REConnect

Tripura Draft Amendment in RPO Regulation

Tripura Electricity Regulatory Commission (TERC) on 18th July 2014 has notified a draft for the amendment in its Renewable Purchase Obligation (RPO) compliance Regulation 2010. In this amendment, TERC has proposed RPO percentages for the next three years (i.e. till FY 16-17).

It is clearly visible that the TERC in the proposed draft has reduced its total the RPO percentage for 2014-15, as compared to 2013-14, but has increased the percentage of Solar RPO significantly. The decrease in the total RPO may be adjudged to the lack in Renewable Energy generation in the state and the increased solar RPO percentage shows that the state commission is setting an ideology to improve the solar energy generation in the state.

The proposed draft can be accessed here.

Contributed by Dheeraj Babariya.

JERC Drafts Solar Tariff Regulation

Joint Electricity Regulatory Commission (JERC) for Goa and Union Territories (UT) on 4th July 2014 has released a draft Regulation of Solar Tariff applicable to Ground Mounted Grid Connected & Rooftop Solar with Net Metering. The regulation shall be applicable to all grid connected Solar PV (including rooftop PV) and solar thermal projects of Goa and the Union Territories.

The primary objective of the policy is to reduce the power deficit in the Union Territories through Solar Power generation. The policy aims to replace diesel power generation by solar power.

Overall the policy is a good initiative by JERC to reduce the dependency on diesel generators. In the recent meeting of Forum of Regulators, emphasis was laid on Solar Rooftop and Net Metering. It can be expected that various SERC’s may come up with their Solar Rooftop and Net Metering policies, which will definitely encourage the sector, that may face tough times ahead after AD was reintroduced for Wind Power.

The Draft Regulation can accessed here.

Contributed by Dheeraj Babariya.

Forum of Regulators discusses Issues of RPO

Forum of Regulators (FOR) held its 41st meeting on 27th June 2014, in Delhi. The Ministry of New and Renewable Energy (MNRE), through a presentation, raised several issues concerning Renewable Purchase Obligation (RPO).

The Key issues highlighted in the presentations are as below:

  • MNRE suggested that the validity REC’s should be extended by 6 months, arguing that a total of 50059 REC’s will expire in next six months.
  • It was suggested that MNRE could consider purchasing the unsold REC’s by using National Clean Energy Fund.
  • The Floor price of Solar REC’s can be reduced due to drastic change (reduction) in Solar PV tariffs over last three years.
  • Giving “MUST RUN” status to RE generation, so that total RE generation could be evacuated, and  have a provision of “Deemed Generation” in case SLDC asked RE generators to back down.
  • Due to poor RPO compliance in all states, the members agreed upon the need of strong RPO enforcement.
  • RPO compliance cost should be allowed in ARR (Average Revenue requirement).
  • The issue of allowing DISCOM’s to purchase REC’s for procuring Renewable Energy beyond their RPO targets was also discussed.
  • The forum suggested that a concept of Renewable Generation Obligation (RGO) for conventional Thermal power plants need to be introduced.
  • Suggestions were given on considering power generated from Large Hydro Projects as Renewable Energy.
  • The Forum also suggested that the concept of Hydro Power Obligation should be introduced.

 From the issues discussed in the meeting it can be deduced that the regulators may come up with strong steps towards RPO compliance. Also, the regulators are set to promote RE generation by making provision for providing proper transmission network for RE generation.

 More information can be accessed here.

 Contributed by Dheeraj Babariya.


MNRE issues Draft Guidelines for JNNSM Phase-2 Batch-2 Scheme

MNRE (Ministry of New and Renewable Energy), has officially issued Draft Guidelines for selection of 1500 MW Grid Solar PV power projects under National Solar Mission, Phase-II Batch-II Scheme.

Here are some key points of the proposed scheme:

  • It is to be carried out by NVVN (NTPC Vidyut Vyapar Nigam Limited) through a transparent, tariff based reverse bidding process.
  • NVVN shall enter into suitable Power Purchase Agreement (PPA) with Solar Power Developers and Power Sale Agreement (PSA) with Distribution Companies/ Utilities/ other Bulk Consumers.
  • There will be two bid tranche: 750 MW in 2014-15, and remaining 750 MW in 2015-16.
  • Projects with minimum capacity of 10 MW and maximum capacity of 50 MW, and connection level with transmission utilities at 33kV and above, shall be permitted to bid.
  • A company can only bid for a maximum capacity of 100 MW per tranche.
  • DCR to be 500 MW out of the total 1500 MW. It was 50 % (375 MW) in Phase-II Batch-I scheme.

Interested stakeholders are required to send their comments by 23rd July, 2014.

It is interesting to note that out of the target capacity of 9000 MW in Phase 2 (2013-2017), 750 MW bids have been successfully completed, and as per this scheme 1500 MW bids will be completed by 2015-16. That leaves just 2 years i.e. 2016-17 and 2017-18 for the remaining 6750 MW of bid capacity.

Target achievement will be difficult but not impossible, considering that by 2017 India aims to achieve Grid Parity with respect to Solar Power, by extending the incentives (concessional customs duty) given to the Solar manufacturing sector and inflow of funds from NCEF.

The draft document can be accessed here.

Our previous Blog on JNNSM Phase-II Batch-I can be accessed here.

MERC Allows Solar Open Access in Maharashtra

MERC (Maharashtra Electricity Regulatory Commission) through an order on 6thMay 2014, has allowed Open Access for the Solar Power in Maharashtra.

The order has come in response of a petition filed by GEA (Green Energy Association – an association whose members are investors in Solar REC space), wherein GEA has requested MERC to direct MSEDCL to issue the Open Access permissions to the solar power generators of the state and also to issue credit notes for the energy injected by the solar generators into the system till date.

The Regulatory Commission said that petition filed by GEA stands disposed of, citing the reason that MSEDCL cannot be partial towards any particular RE Source, and it has already granted Solar OA permission to BEST in Mumbai.

However the Commission has directed MSEDCL to allow the Open Access through solar generator as single source only, as Distribution OA through multi source is in the process of amendment. The Commission also directed MSEDCL to continue the procedures followed for allowing Open Access permissions through RE generators during previous financial year, and to issue all pending credit notes till date.

The detailed MERC order can be accessed here

Our previous blog on MERC RE Tariff can be read here

Maharashtra (MSEDCL) Wind Energy Policy, 2014

Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL) has come up with its wind energy policy in consultation with the MEDA (Maharashtra Energy Development Agency) in order to promote the wind energy generation in the state. The policy was notified on 3rd June, 2014, and will be applicable on projects commissioned in FY 2014-15 and onwards.

This can be taken as a positive step by MSEDCL towards RPO compliance. Under the PPA, the entire power produced will be sold to MSEDCL.

In our opinion, since power is to be sold at tariff determined under PPA with MSEDCL, therefore the projects cannot avail REC’s.

MSEDCL has also set up time limits for connectivity permission as given below:

Processing Fee –
The wind power developer has to submit a non-refundable processing fee of Rs. 1.00 Lac per MW of grid connectivity.Extension of 6 months shall be granted on valid grounds as per directives of MSEDCL. If the generator fails to commission the project within extended period, they will have to re-apply for grid connectivity.

Security Deposit – The wind project developer has to submit a Performance Bank Guarantee of Rs. 5.00 Lacs per MW for sanction of gird connectivity, towards security deposit.

Wind Power Scheduling – It is mandatory for the generator to forecast and schedule the power produced, as per CERC guidelines.

More details on the order can be read here.

Kerala Finalizes Solar Rooftop Policy

Kerala State Electricity Regulatory Commission (KSERC) through an order on 10th June 2014, has finalized its policy for solar rooftop systems. The policy is named Grid Interactive Distributed Solar Energy Systems.

The policy is aimed at promoting solar power in the state by involving more generators. The policy is applicable for all the distribution licensees in the state and to all consumer availing electricity at voltage levels below 11kV, and shall come into force from the date of publication in the official gazette.

According to the regulation, any consumer may install the solar energy system owned by him or by other third party, provided that the installed energy system should fall under the rated limits, as defined under the regulation, and should comply with the systems of the distribution licensee.

The rated capacity of the installed system shall not be less than 1KWp (Kilo Watt peak) and shall not exceed 1MWp (Mega Watt peak).

The output of the solar system shall comply with provisions of the Kerala Electricity Supply Code 2014, which is defined as -

Sl. No. Type of connection Supply Voltage Output specifications
1 Low Tension Single phase 240 V 240 V, 50 Hertz
2 Low Tension Three phase 415 V 415 V, 50 Hertz
3 High Tension 11000 V 11000 V, 50 Hertz

Banking facility: The solar energy systems installed under this regulation are eligible for the banking facility and shall be done on the basis of the readings taken for the billing period applicable to him.

Metering arrangements: The net meters shall be installed at the interconnection point of the consumer with the network of the distribution licensees, and the solar meters shall be installed at the delivery point of the solar systems to measure the energy generated. The commercial settlement shall be done on the basis of readings of this meters.

The eligible consumers have the right to avail open access for wheeling the excess energy generated to one or more premises owned by him within the area of supply of the distribution licensee. Such right for wheeling access energy shall be available only if the wheeled energy to other premises exceeds 500 units in month and the consumer will be able to avail only 95% of the total energy wheeled, while remaining 5% will be adjusted towards distribution losses.

Accounting and settlement – The accounting of the energy generated, consumed and injected by the consumer shall be done on the basis of the readings taken by the meters, for the period applicable to him.

Solar RPO – The energy generated from the solar energy systems of any consumer shall be accounted towards RPO if the consumer is an obligated entity, and if not, then such energy shall be accounted towards RPO of the distribution licensee.

Banking and Cross Subsidy Charge – The eligible consumers generating solar power under this regulation, shall are exempted from banking and cross subsidy surcharge.

The details of the order can be found here

For more details on net metering, click here


REConnect Newsletter Volume 42 – OPEN ACCESS

Dear Reader,

We are pleased to present Open Access Vol 42 – our monthly newsletter covering RECs and regulatory and market developments in the renewable energy space.

 Key points covered in this newsletter are:

 1) Analysis of Karnataka’s solar policy

 2) Regulatory updates including important changes in RPO regualtions in Rajasthan, Order of JERC for enforecemnt of RPO including    imposition of penalty, and other regulatory updates

 3) Analysis of the most recent trading session of RECs and capacities in the REC mechanism

 Past newsletters can be accessd here -

For latest news and updates, please visit our blog at –

 As always, we will love to hear your feedback on the newsletter.

- Team REConnect

REC Trading Report – June 2014

REC trade session for June 2014 was conducted on 25th June 2014. The following is a summary of results -

The total transactional value of non-solar RECs was INR 208.8 million and for solar RECs it was INR 15.4 million. The closing balance of REC inventory for non solar RECs breached the 7 million mark this  month whereas solar RECs crossed 0.23 million mark.



Non Solar RECs -

In case of non- solar RECs demand almost quadrupled (up by 376%) as compared to last trade session (refer  - May 2014 trade report) and Supply grew by 5.23 %. Non Solar price continued to remain at floor (INR 1,500 per REC). More insights provided in graphical charts below :

Solar RECs -

Total solar RECs issued this month was 27,787 and redeemed were 1654 only. In contrast to non-solar RECs, the demand for solar RECs took a beating as it went down by 22%. Supply rose by 11% w.r.t May 2014.  More details can be found in the graphs below -

Solar RECs finished trading at floor for consecutive 12 months.

Relevant media article can be read here.

JERC (Goa & UTs) imposes penalty for non-compliance of RPO

Joint Electricity Regulatory Commission (JERC) for UTs and Goa has become the second electricity regulator to impose penalty for non-compliance of RPO targets. JERC (Goa & UTs) had previously through a suo-motu order (dated 27th Dec 2013) directed all obligated entities to comply with RPO targets of FY11 to FY14 by 31st March 2014 and submit a detailed report by 17th April 2014. JERC notes that some of the obligated entities have failed to fulfil the targets.

Goa – In case of Goa, JERC after scrutiny of the report (submitted by former) was of the view that Goa has failed to fulfil Solar RPO targets from FY11 to FY14 and has consequently been directed to submit a detailed report by 21 July 2014. JERC has asked Goa to meet its RPO targets (along with all backlogs) positively.

Andaman & Nicobar Islands – JERC found that respondent has met with all targets up-to FY14. JERC emphasized that quarterly submission of RPO compliance reports to state agency should continue without fail.

Chandigarh – Chandigarh has also fulfilled RPO targets from FY11 to FY14. JERC mentioned that Chandigarh has also submitted the planning report for compliance of RPO targets of FY15.

Dadra & Nagar HaveliJERC has taken serious steps for non-compliance of RPO targets. The utility of Dadra & Nagar Haveli has therefore been asked to deposit INR 110 crore (Provisional) with the state designated agency positively by 30th September 2014 if it fails to comply with targets by 21st July.

The utility has also been directed to submit proposed plan to meet RPO targets of Fy15.

Daman & Diu – As per JERC, Daman & Diu has also not complied with RPO targets of FY11- FY14. The regulator also emphasized that OA consumers in the area of licensee are also required to meet the targets. The utility in Daman & Diu was asked to submit detailed report by 21st July 2014.

Lakshadweep – Lakshadweep has failed to meet non-solar RPO targets for FY11 to FY14. However, no penalty was imposed with respect to such non-compliance.

Puducherry – Puducherry has failed to comply with solar RPO targets for FY11-FY14, noted JERC. In this case also, there was no penalty imposed and the utility of Puducherry was asked to submit detailed report by 21st July 2014.

The additional information w.r.t amendment to principal RPO regulations is that the same has been forwarded to Controller of Publication, Govt. of India for publication. Our blog-post on the issue can be read by clicking here.

For more details refer the order here.