Rajasthan Electricity Regulatory Commission exempts electricity duty for rooftop solar

The Rajasthan state government recently exempted the elctricity duty of 40p/unit for solar rooftop and captive units. It is expected that this electricity duty cut will have a positive impact on the new capacity lined up by the Rajasthan Electricity Regulatory Commission and also will help to close the 2300 MW rooftop solar capacity by 2022.

This step will create a lot of momentum in the rooftop segment and will encourage individuals and institutions to set up their own plants, thus contributing to the green energy while cutting down on their power costs.

Since Rajasthan has also announced net-metering policy (by which an individual can use the power they generate and the surplus can be fed into the grid), exemption of the electricity duty will be very beneficial to the consumers.

Recently, RERC also had issued a rate contract order for 25 MW & 5MW rooftop plants and empanelled companies to design supply and install these projects; under this the consumer will install a solar power plant and will not have to pay anything upfront.

The regulation can be accessed here.

REConnect Newsletter Volume 52 (June 2015) – OPEN ACCESS

Dear Reader,

 We are please to present OPEN ACCESS – our monthly newsletter that covers important developments in the renewable energy markets. This month’s newsletter covers:

  • Detailed analysis of the 5th Amendment to REC regulations proposed by CERC. This amendment will have significant impact on renewable energy based CPPs and OA projects, and also on the market demand-supply situation down the road
  • Updates on regulatory changes from Gujarat, Telangana, MP, Mahasrashtra, JERC and Rajasthan
  • Analysis of the REC trading sessions in June. Demand was well below May trading volumes. However, the broad trend remains positive due to the SC order on RPO.

 The newsletter can also be downloaded by clicking here - or past newsletters from here.

We hope you enjoy reading the newsletter. Please send us comments and feedback.

 Regards,

 Team REConnect

REConnect Newsletter Volume 41 – OPEN ACCESS

Dear Reader,

We are pleased to present Open Access Vol. 41 – our monthly newsletter covering RECs and regulatory – market developments in the renewable energy space.

Key points covered in this newsletter are:

1) Our analysis on the likelihood of RPO enforcement in FY 2014-15.

2) Regulatory updates including KERC’s final APPC for FY14 & FY15 (interim) & JSERC order on declaration of Bokaro Steel Plant’s CPP as Cogeneration unit.

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

The newsletter is attached with this email and also can be found on our webpage - http://www.reconnectenergy.com/newsletter/past-newsletters/

We hope that you find the newsletter a useful read. Do provide us feedback.

Regards,

- Team REConnect

REConnect Newsletter Volume 40 – OPEN ACCESS

Dear Reader,

We are pleased to present Open Access Vol 40 – our monthly newsletter covering RECs and regulatory and market developments in the renewable energy space.

Key points covered in this newsletter are:

 1) Two important announcements – Infuse Ventures – a clean tech focused venture capital fund invested in REConnect Energy, and 2) The scheduling and forecasting team reached an important milestone of sending over 15,000 schedules till date. This milestone was achieved in a short span of 8 months.

 2) A detailed analysis of the REC markets in FY 2013-14

 3) Regulatory updates including important changes in RPO regualtions in Gujarat and Rajasthan

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

 The newsletter can also be downloaded by clicking here - or past newsletters from here.

 We hope you find the newsletter a useful read. Do provide us feedback.

 Regards,

- Team REConnect

REConnect Newsletter Volume 39 – OPEN ACCESS

We are pleased to present the 39th Volume of “OPEN ACCESS” - our monthly newsletter on REC Mechanism.

The present volume covers analysis on following main topics:

  • Detailed analysis of the bidding under JNNSM Phase 2 by solar industry export Shri Gopal Somani
  • Various regulatory updates including review of revised procedures for RECs accreditation, registration and issuance. Details about reterntion of RECs for own RPO fulfillment are also included.
  • REC trading analysis for February 2014.

To access the current volume (OPEN ACCESS Vol. 39) please Click Here

To read past volumes of our newsletter please follow this link.

We hope you will find this volume of OPEN-ACCESS an insightful read. As always, look forward to your feedback and continued support.

Regards,

Team REConnect

REConnect Newsletter Volume 38 – OPEN ACCESS

We are pleased to present the 38th Volume of “OPEN ACCESS” - our monthly newsletter on REC Mechanism. 

The present volume covers analysis on following main topics:

  • Details of landmark order from UERC for imposing penalty for non-compliance of RPO .
  • Analysis of draft of CERC RE tariff order.
  • Various regulatory updates including: ApTel’s order on TN SPO and CERC’s order on RRF mechanism
  • REC trading analysis for January 2014.

To access the current volume (OPEN ACCESS Vol. 38) please Click Here.

To read past volumes of our newsletter please follow this link.

We hope you will find this volume of OPEN-ACCESS an insightful read. As always, look forward to your feedback and continued support.

Regards,

Team REConnect

REConnect Newsletter Volume 37 – OPEN ACCESS

We are pleased to present the 37th Volume of “OPEN ACCESS” - our monthly newsletter on REC Mechanism. 

The present volume covers analysis on following main topics:
 
  • Recent steps taken by Tamil Nadu, Maharashtra & Delhi towards small scale solar projects. 
  • MERC order on solar RPO for Tata Power Company – Distribution.
  • ApTel’s judgment on fossil fuel based co-gen plants..
  • CERC’s order on REC issuance of UP’s co-gen plants. 
  • REC Trade Analysis – November 2013 & December 2013. 

To access the current volume (OPEN ACCESS Vol. 37) please Click Here.

To read past volumes of our newsletter please follow this link

We hope you will find this volume of OPEN-ACCESS an insightful read. As always, look forward to your feedback and continued support. 
 

Regards,

Team REConnect

RRF Mechanism close to be operationalized

The implementation of Renewable Regulatory Fund mechanism which was scheduled on 01.07.2013 has now been deferred by 15 days and hon’ble CERC in its order dated 09.07.2013 has come up with following implementation plan:

  • RRF to be implemented effectively from 15.07.2013.
  • Role of Coordinating Agency (CA) has been defined as follow:
  • Each pooling sub-station need to appoint CA and declare it to SLDC/RLDC
  • CA to provide schedules and revised schedules to SLDC/RLDC as per the Grid Code
  • CA to coordinate metering, data collection & trans-mission, communication to SLDC/RLDC/RPC/DISCOMs and other agencies
  • CA to undertake commercial settlement of all the charges on behalf of generators & settlement of re-gional/state UI pool account through concerned SLDC
  • CA to manage de-pooling of settlement amount among the Generators
  • RRF guidelines also to be made applicable on CA
  • CA to provide data acquisition system to transfer data at SLDC
  • RRF mechanism shall not be made applicable to COLLECTIVE Transactions to be made at Power Ex-changes as PX transactions can’t accommodate revi-sions in schedules.
  • Operational Timelines – Hon’ble commission has also specified operational timelines for effective imple-mentation of RRF.
  • Weekly Reconciliation of account: for a week (W) starting from Monday 00.00 Hrs (Day 1) and ending on Sunday 24.00 Hrs, RLDC by following Tues-day (Day 9) noon shall provide pooling sub-station wise implications due to RRF. CA to validate the data and con-firm the acceptance and coordinate with RLDC if any cor-rections required.
  • Day 16: Regional Power committee to provide state-ment of energy account by Tuesday
  • Day 17-Day 24: Constituents to settle statement of accounts as per the obligation arising out of RRF mecha-nism.
  • Delay in settlement beyond 12 days to attract 0.04% simple interest per day.

What is RRF?

The Renewable Regulatory Fund (RRF) regulations require wind and solar projects that meet certain criteria to forecast and schedule their power on a day-ahead basis. This requirement will have significant operational and financial implications for the projects – the task of forecasting wind and solar power which are essentially variable in nature and dependent on many site-specific weather factors is complex in nature. At the same time, the scheduling, reconciliation and financial settlement requirements will also require on-ground coordination and liaisoning.

For basics on RRF mechanism, see our past newsletter – Newsletter Vol. XIV October 2011

What are the challenges faced by projects in implementing forecasting and scheduling?

As per order from CERC of Jan 2013, projects were required to start forecasting and scheduling their power from July 1, 2013. However, certain challenges remain that need to be ironed out (see last section).

There are several approaches and models for forecasting generation. It will be very important for projects to choose the appropriate one keeping in mind the accuracy required and operational costs (that can go up significantly depending on the level of real-time data needed). Solar projects in general should opt for correlation based models with basic weather data inputs considering the relative stability in day-to-day generation and no financial implications for deviations. Wind projects must choose carefully between very sophisticated real-time forecasts (which are expensive to run) and models that balance past data with periodic generation inputs.

Once fully functional, projects will need to ensure that they forecast and schedule their power, and also have a ‘Coordinating Agency’ appointed to manage the logistical requirements for scheduling, reporting and settlement.

The scheduling and forecasting has to be done on a pooling substation basis, which will often have turbines with multiple owners. The task of ‘de-pooling’ so that the settlement of charges can be done appropriately amongst all the owners within the wind farm will also be a challenging one.  The data flow diagram for a typical forecasting mechanism can be explained below:

 

What is the status of implementing RRF?  

The most recent pronouncement from CERC required RRF to be operational from July 1, 2013. However, based on our on-ground experience several challenges remain:

Project level – the level of accuracy achieved by various projects that have done trials leaves a lot to be desired. In such a scenario, projects may immediately face financial obligations

Infrastructure level – challenges remain in preparedness at all levels – at the coordinating agency and at some SLDCs in terms of preparedness. Various wind farms also have multiple owners, and de-pooling and the relevant reporting and contractual requirements are not yet in place in the majority of cases.

Clarity in regulations – CERC order of Jan 2013 stated as follows:“

We direct the staff of thee Commission to initiate the process for necessary amendments to the Grid Code in the light our decisions given in this Order. We direct NLDC to align the “Procedures for implementation of the mechanism of Renewable Regulatory Fund”” in accordance with our above directions and put up thee revised Procedures for approval of the Commission expeditiously. All concerned agencies are directed to gear up for implementation of the RRF mechanism w.e.f. 1.7.2013.

Pooling stations are to be regarded as “building blocks” as per recent order. Applicability of RRF is on pooling stations commissioned after May 3rd 2010. In case a pooling station was commissioned (say) 20 years back and two new feeders have been connected to the same after May 3rd 2010. Will the new feeders be eligible for participating in RRF mechanism?

At present, there is nothing strongly mentioned to address his particular issue as per current orders and same needs clarity as far as the operationability is concerned.

For full details of requirements under RRF and services offered in RRF management by REConnect, please contact us at info@reconnectenergy.com.

Karnataka APPC to remain the same till June 2013

KERC issued a gazetted notification dated 02.04.2013, in which it has notified that the pooled cost of power purchase as determined vide its notification dated 27.06.2012 as Rs. 2.60 per unit will remain in effect till 30th June 2013.

The notification says that – “for the purpose of Renewable Energy Certificates (REC), the Karnataka Electricity Regulatory Commission hereby continues the pooled cost at Rs. 2.60/unit till 30th June 2013 or further notification, whichever is earlier.” The Commission has proposed this as an interim measure since it would take some time before power purchase cost for FY13 is finalized.

KERC asserted that the variation in pooled cost based on actual power purchase cost of FY13 shall be adjusted in the future bills accordingly.

Karnataka extends banking facility to Solar Projects

Hon’ble KERC has come up with an order dated 22nd March 2013 for introduction of banking facility to Solar Power Projects in Karnataka. KERC had previously invited comments /suggestions on the issue latest by 25th October 2012.

The Commission has asserted that solar power indeed is infirm in nature and is therefore comparable to those of mini-hydel and wind. In view of the same, the commission has agreed and extended banking facility, with banking charges of 2%, to solar projects on the same terms and conditions as prevalent and applicable to mini hydel and wind generators.

MESCOM and CESC though had a contradictory opinion on the same. CESC submitted that since it has not met its RPO it is not in favour of the motion, while MESCOM feared that it will not be able to meet its RPO as generators will then opt for Open Access. Moreover extending banking along with free wheeling will burden these DISCOMs further.

Referring to an order of Hon’ble ATE dated 22.01.2009, KERC avers that Solar Power Generators will have to bear the difference between the UI charges prevalent at the time of injection and UI charges prevalent at the time of drawal of power along with fixed banking charges of 2%.

Wheeling charges as of now is zero for solar projects and KERC ordered that the same would continue until further notifications.

In our opinion, since zero wheeling charges will be regarded as promotional, solar generators will have to face some glitches as far as their eligibility to explore the REC Market is concerned. Also since solar generators may now favour opting open access, to offset their renewable purchase obligations DISCOMs will inevitably have to buy RECs from the market rather than signing PPA’s with solar generators.

The order can be found here.

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