Blog by Team REConnect

Odisha Finalizes Guidelines for Net Metering

Odisha Electricity Regulatory Commission (OERC) through an order has finalized the guidelines for Net Metering systems, including LT connectivity for Government/ PSU owned buildings only.

 A brief summary of the guidelines is given in table below:

The commission is mandated to promote Renewable Energy by providing connectivity with grid and sale of electricity to any person under EA 2003, which is why it has released this guidelines to enable consumers to set up Rooftop systems.

The state of Odisha has fairly good potential for solar power generation with 280-300 days of sunshine in a year and Global Horizontal Irradiance of about 4.5-5.0 kWh/m2/day.

This guidelines does not make consumers eligible for REC’s. This may be due to the fact that solar tariffs are on the decline whereas the state retail tariffs are increasing year-on-year.

The order can be accessed here.

Rajasthan Draft Net Metering Regulation

Rajasthan Electricity Regulatory Commission (RERC) has recently notified draft regulation for Net Metering & small solar grid interactive systems. The regulation will come into force from the date of notification in the official Gazette.

The regulation will apply to the distribution licensee and the consumers of the licensee. The consumers in the area of distribution licensee are allowed to install rooftop systems under Net Metering arrangement for their internal use and are allowed to supply surplus energy into the distribution system.

Individual Project Capacities: The rooftop solar system should of minimum 1KWp capacity and should not be more than 1MWp. The maximum capacity for rooftop systems to be installed shall not be more than 80% contract demand of the consumer.

Interconnection with the Grid: The connectivity levels at which the Rooftop PV Solar Power Plants shall be connected with the grid are as specified below:

Energy Accounting and Settlement: The distribution system shall install metering equipment at the point of interconnection. For each billing cycle the distribution licensee shall show quantum of energy injected into the distribution and energy drawn for the system. If the energy injected is more than energy drawn for distribution system then the surplus energy will be carried forward to next month, and if the energy drawn is more than energy injected then in such case the licensee will raise invoice after adjusting previous energy credits.

Applicability of Charges: The Rooftop PV Solar Power Plant under net metering arrangement shall be exempted from banking charges.

Solar RPO and REC Eligibility: The quantum of energy generated from rooftop systems will qualify towards the RPO of the distribution licensee, in case the consumer is not an obligated entity. Considering that the consumer can self-consume or sell to a third party under open access, as per current REC Regulation, a consumer availing Open Access benefits is not eligible for REC. Captive consumers who do not avail Open Access benefits for the entire generation (self-consumption + injection into grid) are eligible for RECs for the entire generation.

The comments and suggestion on the draft ca be submitted on or before December 4, 2014.

The Draft Regulation can be accessed here.

Our earlier blog on Rajasthan Solar tariff can be read here.

Contributed By Dheeraj Babariya

Stricter penalties in Electricity (Amendment) Act: Piyush Goyal (Power Minister)

The Power Ministry will soon come up with the Amendment in the Electricity Act 2003, which will have strict penalties. The proposed amendment is likely to be presented in the parliament during ongoing winter session.

“We’re looking at presenting amendments to the Electricity Act in this session of parliament, for strengthening the penalty provisions manifold in the renewable purchase obligations, to make these more stringent,” said Mr. Piyush Goyal, Minister of Power, in a statement.

He said that the current renewable purchase obligation (RPO) is also being re-looked and added, “Earlier, we had certain set of targets till 2022, which we are bringing forward to 2019, we hope that 15 per cent of the renewable power purchase obligation can be enforced to 2015”.

The concept of RGO will also be introduced in the act, in which companies setting up new power projects will have obligation to generate 10% Renewable Energy component.

The amendment will focus on bringing RE into mainframe, as the REC market has not been performing well and there is little RPO compliance by the obligated entities. The RGO will help the govt. to meet its ambitious target of 100 GW solar power by 2022 with wind capacity addition of 10 GW per year.

The provision for forecasting and scheduling of Renewable Energy is expected in act. Also the concept of ‘Must Run’ and ‘Deemed Generation’ are also expected to be part of this amendment. The idea of ‘Hydro Purchase Obligation’ and the provision of giving Renewable status to large Hydro projects can also be included.

It will be interesting to see how this amendment affects the market performance, before the proposed Renewable Energy Act is passed early next year.

Media Articles:

Business Standard

The Economic Times

Indian Express

JERC issues stern orders on RPO

The Joint Electricity Regulatory Commission (JERC) for Goa and Union Territories in its order dated 12th Nov 2014, has again showed strictness towards RPO compliance. In the order the commission has asked all the distribution companies to comply with their RPO and submit a report on the compliance.

In its earlier orders, the commission has given strict directions for RPO target compliance.

A brief summary of the hearing a below:

Secretary (Power) Goa: The commission after examining the report has said that the respondent has failed to submit facts and figures to meet its Solar & Non-Solar RPO, therefore the commission has asked the respondent to submit a detailed action plan to meet RPO, has also directed the respondent to meet RPO of all current and backlog years and to submit a quarterly compliance report to the state agency for verification & certification to the commission without fail.

Secretary (Power) UT Andaman & Nicobar: The commission has said that the respondent has successfully complied with the RPO targets, further commission has asked the licensee to continue submitting the quarterly compliance reports to the state agency.

Secretary (Power) UT Chandigarh: The commission after reviewing the report submitted by the licensee, said that the respondent has successfully complied with the RPO targets of 2nd quarter, the commission has further directed the respondent to regularly submit the quarterly compliance report.

Secretary (Power) UT Dadra & Nagar Haveli: The commission said that the respondent has not complied with the RPO targets and has submitted an incomplete report. The commission has asked the licensee to submit a detailed action plan by 09th Feb 2015 and to meet RPO targets. The commission has directed the Licensee to submit quarterly compliance report on regular basis to the state agency and to the commission without fail.

Secretary (Power) UT Daman & Diu: The commission observed that the licensee has not complied with the RPO current year and had not complied with the commission’s previous orders. It has found that there is huge back log of Solar and non-solar RPO of the respondent. The commission has directed the respondent to meet the RPO targets of current and the previous years and to submit action plan to meet the RPOs, and also submit quarterly compliance report.

Secretary (Power) UT Lakshadweep: The respondent did not submit the report of RPO for back log and current year. The commission said it has taken a serious note on non-appearance in the present petition and non-compliance of its order, and has asked respondent to meet all the back log and current RPO targets. The commission has also asked the licensee to submit a detailed plan to meet RPO targets.

Secretary (Power) UT Puducherry: The commission observed that the respondent has not complied with the RPO targets, so it has asked them to meet the current and back log targets. The commission has asked for a detailed action plan and submit the quarterly compliance reports.

Though the UTs do not significantly contribute much to the demand of electricity, JERC has taken their RPO compliance seriously, but has not yet imposed penalties on any of them.

The order can be accessed here.

Uttar Pradesh Solar Rooftop Policy 2014

Hon’ble Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA), has issued the Solar Rooftop Policy, aimed at Government, Public and Private institutions. The policy aims to promote solar energy generation for self consumption, while excess energy will be injected into the distribution network.

The State has vast potential for deployment of plants utilizing Solar Energy. The State receives daily average solar radiation in the range 5.0 kWh/sqm –5.5 kWh/sqm, in most of its part, offering opportunity for deployment of suitable solar energy facilities.

The main objectives of the policy are:

  1. Encouraging solar energy generation in the state and contributing towards sustainable development.
  2. Attracting investments in manufacturing, research & development in solar energy sector.
  3. Optimally utilising available solar resources & enabling stakeholders to reducing greenhouse gas emissions.
  4. Attracting private sector participation in solar energy sector.

The policy is summarized in the table below:

Overall the policy is good initiative by the state to promote Rooftop solar, but the paltry target of 20 MW by March 2017 does not clearly justify how the government wants private investments in manufacturing and projects, and neither its objective of promoting Sustainable Development to a larger extent. It will not meet its Solar RPO target of 1.5%, 1.75% and 2.00% for 2014-15, 2015-16 and 2016-17 respectively, with the solar roof-top capacity addition target of 20 MW. Buying solar power from states like Rajasthan, would suffice its Solar RPO.

There is no clarity on subsidies, and the interconnectivity with grid rests in the hands of Discoms who are required to submit procedures for the same. The procedures are to be approved by the commission. If Discoms and UPERC cause any delay on their account, it may become a huge deterrent for early projects implementation.

The winter months, starting from November and extending up to March, with foggy weather conditions, will not help the cause of Roof-top solar, but since the long summers are generally characterized by high Solar Irradiation and acute power shortages, Solar Rooftop might provide the right answer for small commercial and residential consumers.

However the government has assured target revision from time to time, and has set attractive tariffs for Solar Rooftop with 5 year commercial visibility.

The Policy can be found here.

Our recent blog on UP RE tariffs can be read here.

Contributed by Dheeraj Babariya.

HPERC imposes penalty on HPSEBL

HPERC on 10th November 2014 issued order on petition filed by M/s Ujaas Energy Limited for non compliance of Renewable Power Purchase Obligation by obligated entities.  Honorable commission has directed obligated entities to procure RECs from power exchange if there is any shortfall in the fulfillment of RPPO. Commission while deciding the case has noted that HPSEBL had fully met and in fact exceeded the specified target for Non Solar RPPO for last three years but was unable to meet the Solar RPPOs for FY 12 and FY 13.The commission has also decided that shortfall of Solar RPPOs for FY 12 and FY 13 shall be met during FY 16 and FY 17.  There was a shortfall of 0.74 MU and 18.4 MU in the solar RPPO for FY 12 and FY 13.

Honorable commission is of the view that in the MYT they have already approved the purchase of solar power by HPSEBL to meet its Solar RPPOs. Keeping in view the judgement of Hon’ble APTEL that since RECs are available in the market, targets cannot be carried forward to future years and had directed HPSEBL should deposit the compensation of Rs 17.23 crores in a separate fund to be created by HPSEBL in its account as RPPO Compensation Fund for non-compliance of RPPO in 2013-14.

JERC orders amendment to RPO Regulation

JERC (Joint Electricity Regulatory Commission) for Goa and Union Territories has ordered amendment to its principal RPO Regulation 2010. The order has already come in force from 22nd April 2014.

The Commission under this amendment has declared RPO targets till FY 21-22. The main highlights of the amendment are as below:

There are few changes in the definitions as:

1.       Renewable Energy Sources - Electricity generating sources recognized or approved by the Ministry of New and Renewable Energy and includes bundled power purchase (to the extent of Renewable Energy content in the bundled Power), power generated from co-generation based power plants wherein the fuel used is non fossil fuel duly recognized as renewable sources by MNRE and certified by the State accredited agency.

2.       ObligatedEntity – The entity mandated under clause (e) of sub-section (1) section 86 of the Act fulfill the renewable purchase obligation under these Regulations and includes distribution licensee, captive user for 1 MW and above with fossil fuel (excluding co-generation based captive power plants) and open access consumer.

3.       Renewable Purchase Obligation – The quantum as mandated under clause (e) of sub-section (1) of section 86 of the Act and specified under these Regulations for the obligated entity to purchase electricity generated from renewable energy sources.

The relevant order can be accessed here.

Our previous blog on JERC Solar Tariff can be read here.

Contributed by Dheeraj Babariya.

CSERC’s order on non compliance of RPO by Discoms for the year 2011-12 & 2012-13

Chhattisgarh State Electricity Regulatory Commission (CSERC) passed an order on 15th October 2014 on non compliance of RPO by DISCOM’s of Chhattisgarh for the year 2011-12 and 2012-13.  In the order CSERC said that they will close this matter of non compliance of RPO by DISCOMs. The questions arises in the order is how, as CSERC has not mentioned about any action to be taken or any penalty to be imposed on the discoms for their non compliance. CSERC in its order have concluded that

“Our attention has been drawn towards the fact that in CSPDCL’s tariff determination, final true up for FY 2011-12 has been completed. Therefore, in our opinion, it would not be appropriate to force them for compliance of RPO for FY 2011-12 at this stage. We are also of the view, that penalizing the other respondents/DISCOM for non fulfillment of their RE obligation for year 2011-12 is unjustified”

Similar order was also given for FY 2012-13. The commission has only asked the Discoms to be more vigilant on fulfillment of RPO in the coming years.

The order can be accessed here ( FY 2011-12) and here ( FY 2012-13).


MPERC imposes penalty for non compliance of RPO

In an order dated 20th October 2014, Madhya Pradesh Electricity Regulatory Commission (MPERC) has imposed a token penalty of Rs. 25,000 for non compliance of RPO.  The order is the outcome of the petition filed by M/S Green Energy Association in the matter of non compliance of solar RPO by the obligated entities for the period of FY 2011-12 to FY 2013-14. The respondent Madhya Pradesh Power Management Co Ltd (MPPMCL) plea was that they could not fulfill the RPO in the past years through purchase of RECs due to poor financial condition of Discoms. On hearing both the parties the commission  found the plea of MPPMCL to be illogical at this stage as RECs are available in the market and the retail tariff order for FY 2014-15 includes the amount to procure energy from renewable sources to meet RPO.  Therefore, now non compliance of RPO cannot be neglected and go unpunished.

The order states that

“ The Commission, therefore, imposes a token penalty of Rs. 25,000.00 on the respondent towards non-compliance of the solar RPO target as per the provisions of MPERC (Co-generation and Generation of Electricity from Renewable Sources of Energy) Regulations, 2010, which is to be deposited with the Commission within 30 days of the issue of this order. It may be emphasized that the penalty is a token and does not redeem the failure of the respondent in the matter. The Commission would like to warn the respondent that future non-compliance in this regard would be dealt with severely. “

This order will be appreciated by the RE generators who have a large inventory of RECs lying with them. Similar orders from SERC of Uttarakhand and Union Territories were made in the past. This is a welcome step and we expect other SERCs to come up with similar orders and take strict action against non compliance of RPO.

The order can be accessed here.

REC Market anticipates strict directions from APTEL

India’s REC (Renewable Energy Certificate) Market is facing a huge backdrop as no strict guidelines are given by state regulators to ensure the compliance of Renewable Obligation defined under RPO Regulation 2010.

In the recent REC trade session held on 24th September 2014 only 22650 Non-Solar REC’s and 1363 Solar REC’s were sold, were as available non-solar REC’s for sale was 90 Lacs and the same in case of Solar was 3.70 lacs. Out of 93 Lac REC’s, which were available for sale, only 24 thousand REC’s were redeemed which is barely close to .25%.

The current scenario of REC market is quite uneventful, REC inventory is racing to new highs, while there is very little response from the buyers (Mainly distribution companies). The absence of strict RPO enforcement is leading to poor trading and reduction in the interests of RE Generators, especially Solar.

In order to bring this issue in to the light, the Indian Wind Energy Association and the Indian Wind Turbine Manufacturers Association, through a petition, have requested before the APTEL (Appellate Tribunal for Electricity) to direct the state regulators to issue strict guidelines for RPO compliance, and ensure rigid timelines for compliance. The response of APTEL is to be watched, as the REC Market clings on the edge, hoping for demand to rise in the forthcoming months.

Recently though, state regulators of Uttarakhand, Gujarat and Punjab have taken a stern stand for the RPO compliance, while in some other states there is no mention of RPO compliance. If the market does not revive soon, there is a chance of it to fall in the wrong lines of the CDM market.

Relevant media article can be read here.

Our blog post on Sep 2014 REC Trade Session can be read here.

Contributed by Dheeraj Babariya.