DERC NOTIFIES RPO REGULATION

The DERC has released draft RPO regulations in an order dated 28/07/2017. Following are the salient features of the regulation:

 

  1. RPO Compliance:

  • Aggregate from the gross purchases from generating stations by Obligated entities shall be considered as the quantum of RE purchase for RPO compliance.

  • All the power produced from Waste-to-energy plants shall be procured by the distribution licensee. This will also contribute towards RPO compliance.

  • Quarterly reports shall be submitted by the obligated entities which will include parameters such as capacity addition, generation and purchase of electricity from RE sources. The same shall also be posted on their website.

  1. Role of SNA:

 

  • Protocol development for regular information collection from RE generating companies, obligated entities, SLDC, chief electrical inspector, ets.

  • RE procurement and RPO compliance reports on a monthly basis by obligated entities which shall also go on their websites. This shall be done by the 10th of the next month.

  • It shall also receive information on or before 30th April from captive users who are consuming electricity generated from captive generating plants about electricity consumption and purchase from RE sources.

  • The same shall be applicable for open access consumers.

This regulation isn’t very different from the previous RPO regulation which was released in October 2012.

The order can be accessed here. The public notice can be accessed here.

Draft KERC (Procurement of Energy from Renewable Sources) Fourth Amendment, Regulations 2016

KERC has notified Fourth Amendment to KERC (Procurement of Energy from Renewable Resources) Regulations on October 27th, 2016. The draft of the proposed amendment is available in www.kerc.org. The highlights of the amendment are:

  1. RPO obligation is on captive plant, grid connected plants and open access consumers only .Hence non grid connected captive plants are free from RPO obligation in Karnataka state.
  2. Every distributions licensee, captive consumer and open access consumers may purchase REC or consume electricity generated from its own Renewable Energy Power Plant whether grid connected or otherwise, to meet its RPO either entirely or partly.
  3. The obligation of distribution licensees to purchase electricity from solar energy may be fulfilled by purchase of solar REC’s only.
  4. The capacity of Renewable Energy Power Plant owned by the obligated entity shall not be less than 250Kw.

KERC has invited written comments/views/suggestions on the proposed amendment latest by November 26th 2016 from interested parties.

Draft KERC (Procurement of Energy from Renewable Sources) Fourth Amendment, Regulations 2016

KERC has notified Fourth Amendment to KERC (Procurement of Energy from Renewable Resources) Regulations on October 26th, 2016. The draft of the proposed amendment is available in www.kerc.org. The highlights of the amendment are:

  1. RPO obligation is on captive plant, grid connected plants and open access consumers only .Hence non grid connected captive plants are free from RPO obligation in Karnataka state.
  2. Every distributions licensee, captive consumer and open access consumers may purchase REC or consume electricity generated from its own Renewable Energy Power Plant whether grid connected or otherwise, to meet its RPO either entirely or partly.
  3. The obligation of distribution licensees to purchase electricity from solar energy may be fulfilled by purchase of solar REC’s only.
  4. The capacity of Renewable Energy Power Plant owned by the obligated entity shall not be less than 250Kw.

KERC has invited written comments/views/suggestions on the proposed amendment latest by November 26th 2016 from interested parties.

Joint Electricity Regulatory Commission (Renewable Power Purchase Obligation and its Compliance)

The Joint Electricity Regulatory Commission (Goa and UT’s) recently came up with its long term Renewable purchase obligation trajectory and compliance regulation, following the footsteps of states like Chhattisgarh, HP and AP. JERC has declared its RPO Trajectory up to 2022 with total RPO of 17% which lags behind in comparison with MoP RPO Trajectory and of other states.

Just like other states, the said obligations will be applicable on total consumption of electricity by an obligated entity, excluding consumption met from hydro electric sources of power. The graph below gives comparison of MoP RPO Trajectory with JERC RPO Trajectory:

 

The JERC Regulation can be accessed here.

 

 

 

Madhya Pradesh Electricity Regulatory Commission (Cogeneration and Generation of Electricity from Renewable Sources of Energy) (Revision-I)

Madhya Pradesh Electricity regulatory Commission (MPERC) recently ordered amendment for its Cogeneration and Generation of Electricity from Renewable Sources of Energy Regulation 2010.

The new amendment has defined the minimum quantum of electricity to be procured by all the Obligated Entities from Co-generation from Renewable Sources of electricity expressed as % of their total annual procurement of Electrical Energy.

The new amendment has excluded consumption met from hydro sources of power during the following Financial Years given as under:-

 

As the Ministry of Power (MoP) declared the national RPO trajectory recently, all the states are expected to declare their RPO trajectory soon.

The MPERC Draft can be accessed here.

National RPO Trajectory Declared

The Ministry of Power (MoP) declared the national RPO trajectory recently. According to the notification, overall RPO % is expected to be 11.5% in 2016-17 (including 2.75% of solar), and rising to 17% in three years (including 6.75% solar).

This trajectory is higher than the current RPO in most states. The onus will now be on the SERCs to amend their RPO regulations to bring it in line with the notification. Infact, Chhattisgarh has already made a beginning with draft regulations published within a week of the notification (the draft regulation is analyzed in the second part of this article).

The notification mentions two other important aspects of calculating RPO:

  •  RPO to be applied on co-generation power
  •  Consumption from hydro sources to be excluded

Conclusion:

Announcing the national RPO trajectory is a welcome step. The entire objective of the RPO and REC regulations was to have a uniform consumption of RE power across the country even though the RE resources differ widely across states. However, this objective was lost along the way. The National RPO trajectory can go a long way is having uniform RPO% across the country. However, there are some issues with the RPO trajectory notification:

  • “Are SERCs obligated to follow? This question remain unanswered. The notification itself says…”
  • SERCs may consider to notify RPO for their respective states in line with the aforesaid uniform RPO trajectory.
  • The RPO trajectory itself has been declared for 3 years only. It would have been good to see a longer trajectory.
  • The exclusion of hydro will need amendments in state RPO regulations
  • Similarly, including co-generation power in RPO calculations will require some states like Rajasthan and MP to amend their regulations

Chhattisgarh Draft RPO regulations – Analysis
Immediately after the notification of the national RPO trajectory, Chhattisgarh announced draft RPO regulations. Key points on the draft regulations are:

  • The RPO % is proposed to increase steeply – from 7.25% in 2015-16 to 20% in 2020-21.
  •  The regulation proposes to apply RPO on co-generation power
  •  Both these changes will have significant impact on Chhattisgarh. It is a state with large captive generation capacity, a large portion of which is from co-generation.

 

 

* Draft regulation

** In Karnataka RPO differs slightly for each Discoms

 

UERC Order on Non Compliance of RPO

UERC Maintains its tough stand for non compliance of RPO. In a recent order the Uttarakhand Electricity Regulatory Commission has directed UPCL to procure non-solar RECs equivalent to 7.50% of unmet non-solar RPO up to FY 2015-16 latest by 31st July’16. UPCL had submitted the following unmet RPO data to the commission:

The Commission has directed UPCL to meet the overall RPO FOR 2016-17 which is 8% for non solar and 1.5% for solar, either through purchase of energy from RE sources or through purchase of RECs equivalent by March, 2017. The Commission has denied UPCL to continue carrying forward of all the unmet non-solar RPO since, it has failed to tap the available power due to its own dilapidated distribution system for evacuation of power.

Also as mentioned in the order, Non-compliance of RPO will attract action against the officers responsible for compliances of regulations.

Earlier in year 2014, UERC had considered UPCL’s non-compliance as willful contravention of the direction of the Commission and had imposed penalty of Rs.20, 000/- on the Managing Director of UPCL. Thus this seems to be a strict order but in a positive direction which will help in streamlining the REC market overall.

 

The order can be accessed here.

UERC Order on Non Compliance of RPO

UERC Maintains its tough stand for non compliance of RPO. In a recent order the Uttarakhand Electricity Regulatory Commission has directed UPCL to procure non-solar RECs equivalent to 7.50% of unmet non-solar RPO up to FY 2015-16 latest by 31st July’16. UPCL had submitted the following unmet RPO data to the commission:

The Commission has directed UPCL to meet the overall RPO FOR 2016-17 which is 8% for non solar and 1.5% for solar, either through purchase of energy from RE sources or through purchase of RECs equivalent by March, 2017. The Commission has denied UPCL to continue carrying forward of all the unmet non-solar RPO since, it has failed to tap the available power due to its own dilapidated distribution system for evacuation of power.

Also as mentioned in the order, Non-compliance of RPO will attract action against the officers responsible for compliances of regulations.

Earlier in year 2014, UERC had considered UPCL’s non-compliance as willful contravention of the direction of the Commission and had imposed penalty of Rs.20, 000/- on the Managing Director of UPCL. Thus this seems to be a strict order but in a positive direction which will help in streamlining the REC market overall.

 

The order can be accessed here.

 

Tamil Nadu Electricity Regulatory Commission Amendment to RPO Regulation, 2010

The Tamil Nadu Electricity Regulatory Commission recently came up with new amendment in the Renewable Purchase Obligation, 2010. The amendment was made in the regulation 3 after sub regulation (1) regarding the RPO percentages as mentioned below

The Commission orders that the Renewable Purchase Obligation specified for 2011-2012 in the sub regulation (1) shall be applicable for the years 2012-13, 2013-14 and 2014-15 to all the distribution licensees.

 

The Order can be accessed here.

Maharashtra Published RPO Regulations for FY 2016-17 to FY 2019-20

Maharashtra published RPO regulations covering the period FY 2016-17 to FY 2019-20. The highlights of the regulation are:

 

  • RPO % in FY 2016-17 is 11% in total (10% non-solar and 1% solar). This will increase to 15% by FY 2019-20 (11.5% non-solar and 3.5% solar)

 

  • The regulations are broadly in line with the standard regulations of RPO across various states, except the following clauses:

 

  • RPO is no longer exempt on co-generation power. The Statement of Reasons (SOR) accompanying the regulations refers to the National Tariff Policy as a reason for removing exemption from RPO on co-gen power.

 

  • RPO is applicable only on consumption of conventional power. This is a significant deviation as the Electricity Act/ CERC/ other states require calculation of RPO on “total consumption”. By leaving out RE power from RPO calculation, Maharashtra risks providing double benefit to RE generators – it is possible that a consumer that consumes power from RE sources does not attract RPO provisions and at the same time claims offset of such RE power towards meeting RPO on conventional power.

 

  • RPO is applicable on CPPs with installed capacity of 5MW or more and open access consumers with a contract demand of 5 MVA or more. This will leave out significant open access and captive capacity form the ambit of RPO applicability.

The regulation can be accessed here.

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