The Proposed amendment defines the solar RPO percentages as well, which was not defined earlier and was considered to be one of the drawbacks towards promotion of solar energy technology. The targets proposed by KERC are shown in the graphs below:
The commission has also proposed new RPO targets for Captive and Open Access consumers, which are in the graphs below:
Apart from the RPO targets the commission has proposed to add the definition of “Contract Demand” and has proposed changes in some clauses as well.
Mainly the commission has proposed that any distribution licensee or other consumers failing to meet the RPO for any year within the time specified, shall purchase RECs to the extent of 110% of quantum of shortfall in meeting RPO, by 30th June of the immediately following year, failing which action under Section 142 of the Electricity Act, 2003 shall be initiated.
The amendment proposes a new way to impose penalty on the consumers failing to meet the RPO, and it directs the consumer to buy REC’s ?by 10% more quantum than the total quantum of energy needed to meet?RPO targets. The amendment also proposes very high RPO targets for coming years, which is a good move, but again, it will need strong enforcement guidelines from the state.
The increase in RPO targets is important, but at the same time targets without proper enforcement would not yield great results, which needs focus as many states are still being lenient over the RPO compliance by state utilities.
The commission has invited the comments from the interested stakeholder and can be submitted latest by 6th Aug 2015.
The proposed amendment and more details about it can be read here.
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BSL had prayed JSERC to
1. declare its CPP of 302 MW as co-generation power plant,
2. exempt BSL from applicability of RPO and
3. waive the RPO applicable on consumption of power from its CPP during FY11, FY12 and FY13.
CPP of BSL fulfills the definition of CPP as BSL has 50% equity in the plant and consumes 100 % of power generated.
JSERC also considered APTEL’s judgement in the case of MERC vs Century Rayon, where in it was declared that fastening of RPO on ?would defeat ?the objective of section 86 (1) (e) of the Indian Electricity Act.
JSERC has RPO targets defined till FY16. It has a total of 4% RPO (1% solar & 3% non-solar) for all three years FY14, FY15 & FY16.
BSL also is a distribution licensee in Jharkhand. As per data furnished in the order total RPO applicable on BSL for consumption of captive power comes around – 64.8 MW of non-solar and 17 MW of solar RPO.
The order can be accessed here.
]]>1) The wheeling charges and banking charges will continue to be 5% of the injected energy and 2% respectively along with additional UI charges between the time of injection and time of drawal.
2)?Captive consumers?of the state wanting to avail the benefits under the?REC scheme?will have to?pay normal transmission, wheeling and banking charges. ?
Normal wheeling charges –
For HT network – ?9.85 paise per unit
For LT network – 22.99 paise per unit.
?3) Captive generators will be allowed to bank the excess energy, accounting of which will be done on monthly basis (instead of annual basis).
4) Excess energy (if any) with the distribution licensee, at the end of the month, shall be paid by the DISCOM (in whose generator is plant is situated) at the APPC rate. Currently, the APPC rate is 3.07 Rs per unit.
5) The commission will shortly issue a separate format of wheeling/banking agreement for RE generators willing to participate in REC mechanism.
]]>” [obligated] entities are getting away with non-compliance because of poor enforcement of regulations and the lack of any penalties. With state discoms being allowed to renege on obligations, many expect private players to follow suit”
The recent demand-supply gap in the September 2012 trading session and the inventory that is building up is starting to worry project developers and potential investors in the renewable space. Vibhav Nuwal of REConnect Energy is also quoted in the article:
“70–80 per cent of the demand comes from the private discoms. The remaining come from captive and open-access consumers,” says Vibhav Nuwal, director at REConnect Energy, the largest trader in this market. Although, Nuwal says, the solar REC market, which began trading in May 2012, is too small and volatile to draw inferences from; he acknowledges the widening demand-supply gap in the non-solar segment.
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The obligation till FY 2016-17 is shown in the table below:
Obligated entities have to submit necessary details regarding total consumption of electricity and purchase of energy from renewable sources before 30th April to the State Agency every year .
Open access consumer receiving electricity from renewable energy sources shall be exempted from the cross-subsidy surcharge determined by the Commission from time to time to the extent of RPO. However, no banking facility shall be provided for supply of electricity from renewable energy sources through open access.
The REC market will strengthen if the enforcement in Delhi has a good start as the consumption here is very high.
Contributed by Rahul Tyagi
Madhya Pradesh recently proposed an amendment to its RPO regulations. The amendment proposes to substitute “Co-generation from Renewable Sources of electricity” with the word “Co-generation” in various sections of the regulation. As a result of this change, companies that have co-gen facilities would be able to off-set their RPO against consumption from co-gen.
This amendment goes the farthest in terms of any states action in the matter so far. It provides a double benefit to co-gen plants – they are not merely exempt from RPO (as in the case of Maharashtra), but can also set-off RPO resulting from other conventional sources with cogen consumption.
This amendment was recently notified. The amendment can be accessed here.
In our view, this is a backward step in MP, as it will inhibit new RE capacity addition in the state. In contrast, Orissa regulatory has recently held that Co-gen obligations and RE obligations are distinct. Forum of Regulators has also suggested the same approach. In the 23rd meeting of FOR, held on 29th & 30th April, 2011, the following was agreed:
After discussion the members agreed with the contention that RPO should be made applicable to co-generation based captive consumers as well, in line with the spirit of Section 86(1)(e) of the Electricity Act, 2003. It was also felt that the scope of Section 86 (1)(e) is to promote Renewable and that only the non-fossil fuel based cogeneration plants should be covered under the said provision for the purpose of RPO.
]]>Overall, the order from the commission is in the right direction. Given the nascent stage that REC markets are in, it will be difficult to enforce full penalties due to non-compliance. However, waiver or retrospective change in RPO % would send a wrong signal to the market and obligated entities.