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Submitted by
SUMIT KUMAR DUBEY
MBA (Power Management)
Roll No 89
August, 2013
Page i of 99
ACKNOWLEDGEMENT
Apart from efforts of the person doing the project, the success of any project depends largely
on the encouragements and guidelines of many others. I take this opportunity to express my
gratitude to the people who have been instrumental in the successful completion of the
project.
I thank to Mr Rajendran Nair, Head-Admin and Corporate Affairs for giving me the
opportunity to work on such an insightful project with such a renowned company. I would
like to extend my thanks to my guide Mr. Kundan Kumar, for showing me the right path
and approach towards the project.
Special thanks to Mr. Neeraj Srivastava and Mr. Avanish Verma for their benevolent
support. I would also like to thank all the staff members of TATA POWER TRADING
COMPANY LIMITED. Without their insights and helpful thoughts, I would not have
gained as much information as I have. Their help has sparked my interest even more.
I feel deep sense of gratitude towards Mr.S.K.Chaudhary, Principal Director, CAMPS, my
internal Project Guide Mrs.
Director, NPTI , Mrs. Indu Maheshwari, Dy. Director, NPTI for arranging my internship at
TPTCL and being a constant source of motivation and guidance throughout the course of my
internship.
I also extend my thanks to all the faculties and my batch mates in CAMPS (NPTI), for
their support and guidance throughout the course of internship.
I am grateful to my family who gave me the moral support in my times of difficulties.
Thank you all for being there for me always.
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DECLARATION
A Seminar presentation of the training report was made on 2nd September and the suggestions
as approved by the faculty were duly incorporated.
Presentation In charge
(Faculty)
Countersigned
Director/Principal of the Institute
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CERTIFICATE
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EXECUTIVE SUMMARY
Sun is the ultimate source of energy and mankind has been harnessing Suns energy ever
since the dawn of civilization. In modern era electricity has become fundamental need of
every human-being and the demand of it is rising by the day. Though fossil fuels are less
cheaper way to generate electricity but the cost paid as degradation of environment is huge
and at present moment the situation of our home planet has become very
poor
environmentally. Nations have acknowledged this threat and are now investing in renewable
sources of energy to produce electricity. Major renewable sources are Hydro, Wind, Biomass
and Solar.
India is blessed with abundant solar energy and if harnessed efficiently, the country is
capable of producing trillion-kilowatts of electricity. Solar energy is extremely beneficial as it
is non-polluting and its generation can be decentralized. There is needto come together and
take initiatives to create technologies for a greater use of these sources to combat climate
change by reducing the emission of green house gases.
This report starts by referring the provisions and important statements in the Indian federal
legislative documents relating to solar technologies.
Comparative study of rules, regulations, policies and tariff components related to solar
technologies has been done of the states of India namely Gujarat, Orissa, Madhya-Pradesh,
Rajasthan, Haryana, Bihar, Karnataka , Manipur and Maharashtra .
Report further deals with Renewable Purchase Obligation (RPO). target set by the SERC
for the distribution utility in the State & Renewable Energy Certificate (REC) mechanism .
To enter into any field of interest with a new project it is very important to scrutinize and
analyse the options available, SWOT analysis of solar technologies in the footsteps of a
developer was carried out during the training and the same has been mentioned Report further
deals with the RRF mechanism and its implication to solar industry in India .
Pros and Cons of state policies and regulations are mentioned from a developers point of
view after comparing them on the basis of parameters namely eligible producer, land
allotment, operative period, sale of power and tariff, wheeling, banking of electricity, power,
evacuation & grid interfacing and incentives
v|Page
Study about the future growth of the solar (pv) in various states and solar radiation pattern for
the viability of solar project in the state. As solar radiation is important for the utilisation
factor of the plant .
Estimation of grid parity in India and its implication on solar power projects and various
methods that can be adopted by solar generators for the selling of their power. Report further
details the role of traders for the promotion of solar.
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LIST OF ABBREVIATIONS
AC
ALTERNATING CURRENT
AD
ACCELERATED DEPRECIATION
CAC
CASE
CDM
CEA
CSDL
CSP
CTU
CER
CUF
DC
DIRECT CURRENT
DNA
DNES
DNI
DOE
EB
EXECUTIVE BOARD
GENCOS
GENERATING COMPANIES
GHG
HCA
IPP
IREDA
IRL
IEGC
JI
JOINT IMPLEMENTATION
JNNSM
Kwh
KILLOWATT HOUR
MoEF
MSEDCL
ENERGY
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MNES
MNRE
MoU
MEMORANDUM OF UNDERSTANDING
MoP
MINISTRY OF POWER
MVVNL
MW
MEGAWATT
MWh
MEGAWATT HOUR
NBFC
NCDMA
NCR
NSE
NSM
NRSE
NSDL
NLDC
NEP
NREL
NTP
NTPC
NVVN
PCN
PDD
PPA
PV
PHOTOVOLTAIC
PEDA
PPDL
PSPCL
RLDC
ROE
RETURN ON EQUITY
RPO
REC
SWOT
SEB
SEZ
SPC
SLDC
UNFCCC
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TABLE OF CONTENTS
ACKNOWLEDGEMENT
DECLARATION
CERTIFICATE
EXECUTIVE SUMMARY
LIST OF ABBREVATIONS
CONTENTS
CHAPTER-1
INTRODUCTION
1.1 SOLAR ENERGY
1.2 SOLAR TECHNOLOGIES
1.3 SOLAR POWER
1.4 OBJECTIVE & SCOPE
1.5 SIGNIFICANCE
1.6 ORGANISATION PROFILE
ii
iii
iv
v
vii
x
1
2
3
5
6
7
CHAPTER-2
9
9
9
9
10
10
10
11
13
15
16
16
18
19
20
21
22
23
24
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CHAPTER-3
STATE SOLAR POLICY ANALYSIS
3.1 STATES
3.1.1 GUJARAT
3.1.2 KARNATAKA
3.1.3 MADHYA-PRADESH
3.1.4 RAJASTHAN
3.1.5 HARYANA
3.1.6 BIHAR
3.1.7 MIZORAM
3.1.8 CHHATTISHGARH
27
28
31
34
39
45
50
56
58
CHAPTER-4
SPO OF VARIOUS STATE, STUDY ABOUT REC, RRF & SWOT ANALYSIS
4.1 SPO OF STATES
4.2 REC
4.3 RRF MECHANISM
4.4 GRID PARITY
4.5 OTHER OPTION FOR SPO
4.6 FINDINGS & RECOMENDATION
62
71
78
84
86
87
BIBLIOGRAPHY
88
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CHAPTER-1
INTRODUCTION
Electricity is one of the basic requirements for economic development. Every sector of the
economy requires input of electricity. Since independence there has been a continuous
growth in electric energy requirement which till date has been majorly satisfied by coal and
will continue to remain the same in near future, but there has been a fast rise in technology
based on renewable sources of energy, mainly Hydro, solar and wind, and their share in total
energy mix has been increasing steadily. Hydro technology has matured over the period of
time but solar is relatively in nascent stage and require R&D for continuous evolution.
Fig. 1.1 Average insolation showing land area (small black dots) required to replace the world primary energy
supply with solar electricity. 18 TW is 568 Exajoule (EJ) per year. Insolation for most people is from 150 to 300
W/m2 or 3.5 to 7.0
Page 1 of 99
Solar technologies are broadly characterized as either passive or active depending on the way
they capture, convert and distribute sunlight. Active solar techniques use photovoltaic panels,
pumps, and fans to convert sunlight into useful outputs. Passive solar techniques include
selecting materials with favourable thermal properties, designing spaces that naturally
circulate air, and referencing the position of a building to the Sun. Active solar technologies
increase the supply of energy and are considered supply side technologies, while passive
solar technologies reduce the need for alternate resources and are generally considered
demand side technologies
CRYSTALLINE
SOLAR PV
THIN FILM
SOLAR
TECHNOLO
GY
THERMAL
SOLAR
CHIMNEY
CSP
STIRLING
Parabolic
Trought
Solar tower
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1.1.2.2 PHOTOVOLTAICS
A solar cell, or photovoltaic cell (PV), is a device that converts light into electric current
using the photoelectric effect. The first solar cell was constructed by Charles Fritts in the
1880s. Solar cells produce direct current (DC) power, which fluctuates with the intensity of
the irradiated light. This usually requires conversion to certain desired voltages or alternating
current (AC), which requires the use of the inverters. Multiple solar cells are connected inside
the modules. Modules are wired together to form arrays, then tied to inverter, which produces
power with the desired voltage, and frequency/phase (when AC). Many residential systems
3|Page
are connected to the grid wherever available, especially in the developed countries with large
markets. In these grid-connected PV systems, use of energy storages are optional. In certain
applications such as satellites, lighthouses, or in developing countries, batteries or additional
power generators are often added as back-ups, which forms stand-alone power systems. The
214 MW Charanka Solar Park (Gujarat) in India is the worlds largest photovoltaic power
station.
The evolution of solar technology to current stage is the result of research that started
in1800s.
Crystalline silicon
Polycrystalline silicon is also a key component of solar panel construction. Growth of the
photovoltaic solar industry was limited by the supply of the polysilicon material. For the first
time, in 2006, over half of the world's supply of polysilicon was being used for production of
renewable electricity solar power panels. Only twelve factories were known to produce solar
grade polysilicon in 2008. Modules are typically categorized as mono-crystalline or
polycrystalline modules. Mono-crystalline silicon was higher priced and more efficient than
multi-crystalline. This however changed and, in 2011, there was a large excess of production
capacity of polysilicon.
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1.3 SIGNIFICANCE
The significance/usefulness of this project can be shown as:1. The report shall be useful in providing the necessary data for decision making in
solar domain.
2. It shall enhance the knowledge of reader by providing in-depth view of energy
and tariff policies.
3. The project shall provide a simple view of complex legislature thus making it easy
to understand.
4. It provides compiled information, thus reader doesnt have to refer many
documents.
5. It provides recommendations and findings which shall help making future plans
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1.1 VISION
To be the leading and the most admired power trading company in India.
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1.2 MISSION
To serve our customer and partners through innovative and effective power trading solutions and
associated services; rendered with transparency, speed , reliability, safety and efficiency. To
create value for all the stakeholders through unique combination of talent, knowledge, skills and
technology.
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CHAPTER-2
LITERATURE SURVEY & SCENARIOS
2.1 LEGISLATION EVOLVEMENT
The legislature for electricity sector has been evolving from the 1800s providing important
guidelines for smooth and efficient functioning of power sector. The concept and need of
provisions for inclusion and enhancement of renewable energy was felt in the later stages. In
this section we take a look at different acts and see what they say about renewable including
solar energy.
As the sector progressed, need was felt to divest regulatory powers from government and in
pursuance of this vision this act was formulated to provide for the establishment of a Central
Electricity Regulatory Commission and State Electricity Regulatory Commissions,
rationalization of electricity tariff, transparent policies regarding subsidies, promotion of
efficient and environmentally benign policies and connected matters. During this period the
installed capacity of solar PV in the world had surpassed the 700 MW mark but India was
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still not in the picture and also the act did not convey any guidelines for the non conventional
sources of electricity generation
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Section 6.4
The section states that in present stage the conventional and non-conventional technologies
cannot compete at similar tariff and hence the power shall be procured from nonconventional
sources at preferential tariff determined by the appropriate commission but it also states that
in long term the non-conventional technologies have to compete with other sources in terms
of full cost. It also states that appropriate commission will fix the minimum percentage of
power to be procured from non-conventional sources with reference to section 86 (1) of
electricity act 2003.
6. To deploy 20 million solar lighting systems for rural areas by 2022. The ultimate objective
of the Mission would be to develop a solar industry in India that is capable of delivering solar
energy competitively against fossil options from the Kilowatt range of distributed solar
thermal and solar PV to the gigawatt scale of base load priced and dispatchable CSP within
the next 20-25 years.
Section 3.1-Technical
This section defines different technologies used for solar generation as addressed earlier in
section 1.2 and also encourages research and technology collaborations, it also defines the
responsibilities of National solar mission as:-
India,
3. Realizing integrated private sector manufacturing capacity for solar material, equipment,
cells and modules.
4. Networking of Indian research efforts with international initiatives with a view to
promoting collaborative research and acquiring technology where necessary, and adapting the
technology acquired to Indian conditions.
5. Providing funding support for the activities foreseen under 1 to 4 through government
grants duly leveraged by funding available under global climate mechanisms, and
earnings
from deployment of research sponsored by the Mission. Policy and Regulatory measures for
promotion of solar technologies would also be enhanced as common to all renewables based
technologies.
The section also addresses the targets and the technology gap between domestic and foreign
players and goes on to say that Indian approach should be in order to bridge this gap
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It was formed by NTPC Ltd, as its wholly owned subsidiary to tap the potential of power
trading in the country thereby promote optimum capacity utilization of generation and
transmission assets in the country and act as a catalyst in development of a vibrant electricity
market in India.
In order to facilitate grid connected solar power generation in the first phase,
a mechanism of "bundling" relatively expensive solar power with power from the unallocated
quota of the Government of India (Ministry of Power) generated at NTPC coal based stations,
which is relatively cheaper, has been proposed by the National Solar Mission. This "bundled
power" would be sold to the Distribution Utilities at the Central Electricity Regulatory
Commission (CERC) determined prices
NVVN is the designated Nodal Agency for procuring the solar power by entering into a
Power Purchase Agreement with Solar Power Generation Project Developers who will be
setting up Solar Projects before March 2013 and are connected to the grid at a voltage level
of 33 kV and above. For each MW of installed capacity of solar power for which a PPA is
signed by NVVN, the Ministry of Power (MoP) shall allocate to NVVN an equivalent
amount of MW capacity from the unallocated quota of NTPC coal based stations and NVVN
will supply this "bundled" power to the Distribution Utilities
IEGC provides standards, guidelines and rules to be followed by all utilities using and
connected to interstate transmission system (ISTS) to develop, maintain and operate the
power system, in the most secure, reliable, economic and efficient manner so that healthy
competition in the generation and supply of electricity can occur
IEGC 2006
IEGC 2006 does not provide for guidelines for renewable energy
IEGC 2010
IEGC 2010 includes the guidelines for the use of renewable described below
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Section 1.2
This section states that providing facilitation of the development of renewable energy sources
by specifying the technical and commercial aspects for integration of these resources into the
grid is one of the objectives of IEGC.
The interpretation of this section in view of renewable is that while formulating scheduling
and dispatch code it has been kept in mind that focus of Indian government is towards
enhancement of renewable.
Section 2.4.5
This section states that preparation of monthly renewable regulatory charge account based on
data provided by SLDC/RLDC of the State/Region by RPC Secretariat or any other person as
notified by the Commission from time to time is amongst the roles of RPC.
The sections statement states that the CTU while planning scheme shall consider renewable
capacity addition plan issued by Ministry of New and Renewable Energy Sources (MNRES).
This section talks about outage plans and states that the outage planning of run-of-the-river
hydro plant, wind and solar power plant and its associated evacuation network shall be
planned to extract maximum power from these renewable sources of energy.
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This section states that while formulating scheduling and dispatch procedures for long term
access, medium term and short term open access it is to be considered that all renewable
energy power plants, except for biomass power plants and non-fossil fuel based cogeneration
plants whose tariff is determined by the CERC shall be treated as MUST RUN power plants
and shall not be subjected to merit order dispatch principles.
Section 6.5 (13) (iii)
The Concerned RLDC and SLDC shall maintain the record of schedule from renewable
power generating stations based on type of renewable energy sources and also while
scheduling generating stations in a region, system operator shall aim at utilizing available
wind and solar energy fully.
Annexure-1 (7)
Annexure-2 (9)
This section issues guidelines to NLDC to prepare, within one month of notification of these
regulations, a detailed procedure for implementation of the mechanism of Renewable
Regulatory Fund and submit the same for approval by the Commission.
Tariff regulations were launched for the rational determination of tariff throughout the
electricity sector but tariff determination of power from non-conventional sources of energy
was not in its scope
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Section 4
The Commission decided to come out with a separate regulation for determination of tariff
based on nonconventional energy sources
Tariff regulations for renewables for a period of five years starting from 2012-13 were
released by CERC. The main objective of these regulations was to rationalize the tariff and to
bring the non-conventional sources at par with conventional sources. The tariff regulations
comprehensively defined terms and levellised tariff calculations criterias with examples
Solar
Some important point given under the regulations for solar are:1. As per section 2 (1) (aa) the useful life of solar is 25 Yrs.
2. As per section 6 (b) tariff period for solar (PV and thermal) is 25 Yrs.
3. As per section 5 the benchmark capital cost of solar technologies (PV & Thermal)
be reviewed annually by CERC.
may
4. As per section 9 the tariff shall be single part-tariff with five fixed components namely, a)
Return on equity b) Interest on loan capital c) Interest on working capital
d) Depreciation
5. As per section 11 (4) solar generating plants with capacity of 5 MW and above &
connected at the connection point of 33 KV level and above shall be subjected to
scheduling and dispatch code as specified under IEGC-2010, as amended from time to
time.
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the Ministry is to develop and deploy new and renewable energy for supplementing the
nergy requirements of the country. The ministry has evolved in following steps:-
1. The sudden increase in the price of oil, uncertainties associated with its supply and the
adverse impact on the balance of payments position led to the establishment of the
Commission for Additional Sources of Energy (CASE) in the Department of Science &
Technology in March 1981. The Commission was charged with the responsibility of
formulating policies and their implementation, programmes for development of new and
renewable energy apart from coordinating and intensifying R&D in the sector.
2.
(DNES), that incorporated CASE, was created in the then Ministry of Energy.
3.
A unique institutional innovation has been the setting up of the IREDA (Indian
1993 prepared policy guidelines for promotion of power generation from renewable energy
sources which included provisions such as accelerated depreciation, concessions
the banking, wheeling and third party sale, among others. Power being a
between the central and the state governments in India; different
regarding
concurrent subject
5. In October 2006, the Ministry was re-christened as the Ministry of New and Renewable
Energy (MNRE). MNRE is the nodal Ministry of the Government of India for all matters
relating to new and renewable energy. MNRE is the administrative ministry entrusted
the responsibility of policy making, planning, promotion and coordination of
with
various
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Facilitate research, design, development, manufacture and deployment of new and renewable
energy systems/devices for transportation, portable and stationary applications in rural, urban,
industrial and commercial sectors through:
the
same.
3. Lay down standards, specifications and performance parameters at par with
international levels and facilitate industry in attaining the same.
4. Align costs of new and renewable energy products and services with international levels
and facilitate industry in attaining the same.
in
9. Identify areas in which new and renewable energy products and services need to be
deployed in keeping with the goal of national energy security and energy
independence.
10. Deployment strategy for various indigenously developed and manufactured new and
renewable energy products and services.
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Central Government shall, from time to time, prepare the National Electricity Policy, policy
for stand-alone systems in rural areas and tariff policy, in consultation with the State
Governments and the Authority for development of the power system. The information flows
according to the organizational structure as stated below.
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Coal and Oil have been major energy sources for a long time and in the recent time there
have been continuous fluctuations in their supply pertaining to many reasons, further there
has been a steep rise in the price of coal worldwide and consumption with countries like
Japan entering market as coal consumers, these situations have led the world to recognize the
vast potential and need of renewable sources including solar energy in the total energy mix
and the efforts in the field of renewable have increased a great deal which can be seen
through continuous rise in the installed capacity of Solar
35%
30%
25%
20%
Energy consumption fuel
15%
10%
5%
0%
Oil
Natural gas
Coal
Nuclear
Hydro
Renewables
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In this century, solar power has already become a small part of daily life. From solar heated
swimming pools to solar powered homes, some examples already exist to show the useful
application of the clean, safe, sustainable power of the sun. Yet many wonder if small
applications will be all solar power is capable of handling. Certainly, the difficulties of large
solar plants are many, although many experts continue to insist that the future of solar energy
is quite sunny. According to some experts, the sun is our best source of renewable, clean
energy. Some estimate that the sun can produce 10,000 times as much energy as the Earth
uses at the turn of the 21st century. The future of solar energy depends mostly on how it is
applied, rather than whether it would be enough energy to be a viable world power source.
The largest problem facing the future of solar energy is the space required to build solar
power plants. A solar plant is comprised of thousands of solar panels and requires a
consistently sunny area and a considerable amount of space. Currently, the one of the largest
solar power stations in the world covers more than 10 square miles (16.9 km squared) and
creates enough power to run about 200,000 homes. In addition to building more and larger
plants, the future of solar energy lies in the construction of new buildings and the retro-fitting
of many older ones. As long as the trend toward alternative energy supplies continues, some
experts predict that most, if not all, new buildings will have solar-energy panels installed on
roofs. Since these are also easily installed, many older buildings may receive upgrades to run
on solar power. Experts and environmentalists hope that green-energy building will be
encouraged by world government through generous tax incentives and exemptions for
alternative energy use. One encouraging factor about the future of solar energy is that many
of the world's greatest innovators are choosing to focus their considerable talent and funds on
improving alternative energy technology.
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India acceded to the Kyoto Protocol in August 2002 and one of the objectives of acceding
was to fulfill prerequisites for implementation of Clean Development Mechanism projects, in
accordance with national sustainable priorities, where-under, a developed country would take
up greenhouse gas reduction project activities in developing countries. MoEF is pursuing
capacity building projects with GTZ (Gesellschaft fr Technische Zusammenarbeit), UNDP
(United Nations development programme) and ADB (Asian Development Bank). CDM is
explained in detail in the later part of this report.
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Date of Update:
Sr. No.
States
Andhra Pradesh
23.15
Arunachal Pradesh
0.025
Chhattisgarh
Delhi
2.525
Goa & UT
1.685
Gujarat
824.09
Haryana
7.8
Jharkhand
16
Karnataka
14
10
Kerela
0.025
11
Madhya Pradesh
11.75
12
Maharashtra
34.5
13
Odisha
13
14
Punjab
9.325
15
Rajasthan
442.25
16
Tamil Nadu
17.055
17
Uttarakhand
5.05
18
Uttar Pradesh
12.375
19
West Bengal
Total
1440.605
Note : The data is compiled on the basis of information obtained from IREDA, NVVN, State
Agencies and Project Developers
Projects
Projects Under JNNSM
Capacity (MW)
421.9
824.09
91.8
23.905
Other projects
78.91
Total
1440.605
Other prospects
Based on below solar map the solar potential of different regions is calculated and
accordingly planning is done for setting up solar projects. The solar industry has immense
potential for a tropical country like India where around 45% of households, mainly rural
ones, do not have access to electricity, India is endowed with large solar potential estimated
to be 20-30 MW per square kilometer, with regions like Rajasthan or Ladakh having well
over 6 kWh incoming insolation/m2 daily in which some 15% can be converted to electricity
using efficient photovoltaic modules. Allocating just 1% of Indias land area for solar could
provide for roughly 500000 MW of capacity. Roof top solar PVs have great potential in India
as almost every region of country gets sunlight also concepts like green building have been
accepted by the government and industry which generate huge markets for solar companies
Many states have started promoting solar based applications by giving incentives and tax
savings. States like Gujarat and Rajasthan have formulated transparent and progressive
regulatory framework in order to boost the solar industry. Besides, states like Delhi, Uttar
Pradesh, West Bengal, Maharashtra and Chandigarh are promoting solar energy in rural,
urban and semi urban areas.
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CHAPTER-3
STATE SOLAR POLICY ANALYSIS
States have issued polices for promoting solar energy, some have issued a separate policy for
solar while others have integrated the same in policy for new/renewable/non-conventional or
energy policy, some states have also issued orders. In this section following parameters of the
policy have been studied:-
1. Eligible Producer
2. Land Allotment
3. Operative period
5. Wheeling
6. Banking
The states have issued guidelines/policy or orders keeping in view the requirement (present
and future) of state and to fulfil mandatory obligation. All policies have pros and cons which
are shown state wise in the next section from a developers point of view:-
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3.1.1 GUJARAT
A state specific policy dedicated to solar was first envisioned by Gujarat in 2009. The outlines were
given under the policy titled Solar Power Policy -2009. The policy was the first solar specific policy
introduced in the country predating the National Solar Mission.
The Gujarat Solar Policy is operative till 31st March 2014.Any Solar Power Generator (SPG) commissioned
during the operative period shall become eligible for incentives declared under this policy for a period of 25
years.
Salient Features:
Capacity:
o Only new plants and machinery will be eligible under this Policy. No fossil fuel shall be allowed for
Solar Thermal Project.
o The minimum capacity of for Solar PV and Solar Thermal projects will be 5 MW each. A total of
500MW SPG shall be allowed for installation during the operative period of this policy.
Cross-subsidy charge:
Cross subsidy surcharges shall not be applicable for Open Access obtained for third party sale within
the state.
Wheeling Charges:
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PPA :
PPA duration will be 25 years
Bank Guarantee:
Developer to furnish a BG @Rs 50Lakhs/MW at the time of PPA signing with Distribution
Licensee.BG to be refunded if the developer commissions the project in time as per PPA.
Metering of Electricity:
Electricity generated would be metered jointly on a monthly basis by GEDA/GETCO. Metering to done
at sending sub-station of 66 kV or above, located at the site.
Reactive power charges:
As per GERC order.
Transmission infrastructure:
Transmission line from SPG switch yard to GETCO sub-station shall be laid by GETCO.SPG to inject
power at 66kV.
Sharing of CDM benefit:
SPG will pass 50% of CDM benefit to DISCOM with whom PPA is signed.
Forecasting & Scheduling:
SPG based generation shall not be covered under scheduling procedure for Intra-state ABT.
Nodal Agencies for facilitation and implementation of Solar Power Policy- 2009:
- Gujarat Energy Development Agency (GEDA)
- Gujarat Power Corporation Limited (GPCL)
The detailed policy document can be downloaded from the following link:
Gujarat Solar Policy 2009
PROs
The policy is very detailed and comprehensive and even describes the
financial and technical requirements of SPG
The tariff allotted is very lucrative.
Long Incentive period of 25 years attract
investors.
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CONs
There is capacity cap of minimum 5 MW
Bank guarantee of 50 Lakhs /MW is on
for SPG.
Gujarat has a very detailed and in-depth policy. The policy favours the big players and there
is very little room for new players to enter. There is little assistance from government in
fulfilling land requirement which is compensated by providing many benefits. It can be seen
from the eligibility criteria and policy on whole that Gujarat government only wants serious
and big players to enter their power market. The policy has a moderate operative period of
five years
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3.1.2 KARNATAKA
Under the Karnataka Renewable Energy Policy, it is envisaged that the State will have a target for
achieving 126 MW of solar power up to 2013-14. The Govt. of Karnataka had released the Solar
Policy for FY11-FY16 on 1st July 2011 envisaging to set up a capacity of 200 MW of solar power in the
state for the RPO fulfilment of the ESCOMs. The policy came into force from 1st July 2011 and shall
remain in force up to 31st March 2016.
Salient Features:
Proposed Capacity:
It is proposed to install 200 MW up to 2015-16, for the purpose of procurement by the ESCOMS. This
will be in addition to the allotment received under JNNSM. The annual capacity approved will be as
follows:
- This does not include CPP and those put up for sale of power to third party.
- The minimum capacity shall be 3 MW and max. capacity will be 10 MW for Solar PV projects and
min. capacity shall be 5 MW for Solar Thermal projects
- Power evacuation shall be through 11 KV and above voltage will only be permissible.
- Project allocation will be done through competitive bidding process with a maximum tariff being in
accordance with the KERC order.
Additional Capacity:
The state reserves a capacity of 50 MW from the central or state owned undertaking for setting up
solar projects in the state for providing solar power bundled with thermal power from outside the state
at the rates to be determined by the govt. subject to the approval of KERC. This is in addition to the
200 MW of capacity planned as mentioned above.
Wheeling & OA charges:
In addition to envisaged 200MW capacity, captive power plants and plants for sale to third party will
also be set up. In case of captive power plants and projects for sale of power to third party other than
ESCOMs, wheeling and open access charges have to be paid as determined by KERC/CERC
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REC Scheme:
Under the REC mechanism the project developers can sell their power at the pooled cost of
power purchase only to the ESCOMS. A capacity of 100 MW can be installed under this
scheme.
CDM Proceeds:
Metering:
Metering arrangement shall be made as per Central Electricity Authority (Installation &
Operation of Meters) Regulations, 2006, the grid code, the metering code and other
relevant regulations issued by KERC/CERC in this regard
The state will continue to implement JNNSM and all other schemes of the MNRE.
KREDL will be the nodal agency for facilitating and implementing this policy.
The detailed policy document can be downloaded from the following link:
Karnataka Solar Policy 2011-16
PROs
State government provides land if available.
Banking of power is allowed.
Solar grid connected projects above 1 MW
12/kWh for solar PV & Rs. 10/kWh for solar
32 | P a g e
CONs
Land Owners to be equity partners of
Karnataka solar policy encourages power through solar by providing various incentives.
Major thrust is on captive as 50% installed capacity is for captive use. The policy discourages
entrepreneurship in solar projects because of the high value of installed capacity for
projects (not under JNNSM).
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3.1.5 MADHYA-PRADESH
Madhya Pradesh has come out with its Solar Policy 2012.
All Solar energy based power project Developers (Solar PV/Solar thermal) and manufacturing units of
equipments, ancillaries related to Solar Power projects shall be eligible for benefits under the Policy.
Only new plant and machinery shall be eligible for installation under the Policy
Salient Features:
There will be four categories of Solar Projects covered under the policy
- Category I: Projects selected as per the competitive bidding process for selling power to MP
discoms / MP Power Management Company. Maximum/minimum capacity will be as per RfS
document issued by GoMP from time to time. Only project capacities to be installed in the state of
Madhya Pradesh shall be eligible for incentives under this Policy. The total capacity under this
category will be as per the Renewable Purchase Obligation (RPO) targets specified by M.P. Electricity
Regulatory Commission (MPERC) from time to time or as decided by the GoMP.
- Category II: Projects, of unlimited capacity(subject to single project capacity limitation described
below), to be set up for captive use or sale of power to 3rd party within or outside the state or for sale
of power to other states through open access . Only project capacities to be installed in the state of
Madhya Pradesh shall be eligible for incentives under this Policy.
- Projects on Private Land: There is no maximum capacity cap on single project installed on private
land. For projects proposed to be set up on private land, any developer willing to establish solar
power project shall be eligible for incentive subject to registration with the GoMP. Performance
Guarantee to be provided will be as per the guidelines specified in the qualification/selection
document issued by GoMP
For projects proposed to be set up on government land, there shall be a set of qualification criteria
fixed by the GoMP. Every such applicant shall be evaluated against each of the qualification criteria
as specified in the invitation document. Upon eligibility, the available land shall be offered on the basis
of maximum free energy per Mega Watt offered by the qualified bidders. Only such selected projects
34 | P a g e
shall be eligible for incentives under this Policy. Performance Guarantee to be provided will be as per
the guidelines specified in the qualification/selection document issued by GoMP
- Category III: Projects, of unlimited capacity, to be set up under Renewable Energy Certificate (REC)
mode. The minimum and maximum single project capacity for accreditation under REC mechanism
will be as per the Guidelines/Orders/Regulations issued by CERC/MPERC from time to time.
- Projects on government Land: For projects proposed to be set up on government land, in addition
to CERC REC mechanism criteria, there shall be a set of qualification criteria fixed by the GoMP.
Every such applicant shall be evaluated against each of the qualification criteria as specified in the
invitation document. Upon eligibility, the available land shall be offered on the basis of maximum free
energy per Mega Watt offered by the qualified bidders. Only such selected projects shall be eligible
for incentives under this Policy. The Developer shall submit Performance Bank Guarantee at the rate
of Rs. 5.0 Lac/MW or part thereof to New & Renewable Energy Department (GoMP). Guarantee shall
be valid for a period of twenty four (24) months for Solar PV projects and for a period of forty (40)
months for Solar thermal projects respectively
- Projects on Private Land: For projects proposed to be set up on private land, any enterprise
fulfilling the requirements/criterion as specified under CERC REC mechanism may apply to the State
Nodal Agency as per the procedures laid down by CERC and/or MPERC. Such developers can apply
for registration any time. In case the project is set up on private land then developer is exempted from
submitting any performance guarantee
- Category IV: Projects under Jawaharlal Nehru National Solar Mission. The minimum and maximum
project capacity will be as per JNNSM guidelines.
Timelines:
Category I Projects: Solar projects under this category will be required to strictly adhere to the
timelines as specified in the qualification/bid document issued by the GoMP.
Category II & III Projects: The project must be commissioned within the timelines mentioned below:
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Decentralized and off-grid solar projects: The Govt. of MP will promote decentralized and off-grid
solar applications, including hybrid systems as per guidelines issued by MNRE
Performance Guarantee:
o Category I project: It will be as per the guidelines specified in the qualification/selection document
issued by GoMP.
o Category II Projects and Category III: The Developer shall submit Performance Bank Guarantee
(for projects being setup on government land at the rate of Rs. 5.0 Lac/MW or part thereof to New &
Renewable Energy Department (GoMP). The Bank Guarantee shall be valid for a period of twenty
four (24) months for Solar PV projects and for a period of forty (40) months for Solar thermal projects
respectively
Contract Demand Reduction:
The Industrial Consumers opting to buy power from Solar Power Project under category II and III shall
be allowed corresponding pro-rata reduction in Contract Demand on a permanent basis but subject to
the decision of MPERC in this regards.
Metering:
Metering equipment, as may be stipulated by MPPTCL or by respective MP Discom, shall be installed
at the interconnection point which shall be line isolator of outgoing feeder on HV side of the pooling
substation. Developers will install metering equipments at their own cost
Grid evacuation & evacuation facility
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The developer shall be responsible for laying of power evacuation line from generating station to the
nearest substation or interconnection point. He shall also be responsible for interconnection
arrangement which includes transformer panel, protections, metering etc, at the substation or
interconnection point.
Wheeling and transmission charges:
The Developer shall be responsible for payment of all wheeling and transmission charges to the
MPPTCL/respective Distribution Company in case of sale of power to Third Party Consumers/
Distribution Licensee/ Power Management Co. Ltd utilizing their network the payment shall be subject
to the regulations of MPERC.
Land:
For setting up Solar Power Plant in Madhya Pradesh, maximum land use permission for government
land, if available, to the Solar Power Producer shall be 3.0 Hectares per MW. In case the Developer
purchases private land for the project, then they will be eligible for an exemption of 50% on stamp
duty.
In case of land owned by Revenue Department or any other State Government Department, the New
& Renewable Energy Department shall take possession of the land and subsequently give permission
for use of land to the concerned Developer (whose project has been accorded administrative
approval)
Wheeling charges:
The policy provides a grant of 4% (in terms of energy injected) by the state under wheeling charges to
all solar power projects.
Electricity Duty:
Policy provides 10-year (from COD) exemption in electricity duty (including captive units),
Banking:
Banking (2% banking charges) of 100% of energy in every financial year shall be permitted. The
balance energy, if any, at the end of a Financial Year after return of banked energy shall be
purchased by the concerned State Distribution Company/ State Power Trading Company in
accordance with the rules/ directions of MPERC.
VAT:
Equipments purchased for installation of Solar power plants will be exempted as per VAT rules and
entry tax.
CDM Benefits:
CDM benefits to the solar power project Developers/Investors shall be as per the provisions specified
by MPERC.
Others:
Regarding other facilities/incentives such as Open Access, Reactive Power and Renewable Purchase
Obligation, the provisions specified by MPERC shall be applicable
The detailed policy document can be downloaded from the following link:
Madhya Pradesh Solar Policy 2011
PROs
The state government provides land if
37 | P a g e
established.
CONs
Developer to commission project in 15 months
A huge amount of registration fee is to be
500000)
As can be seen above the Madhya-Pradesh policy has more pros than cons. The
draft policy encourages entrepreneurship and also encourages existing players
through various incentives. There is also focus on stand alone systems and many
incentives are being offered to power producer, the policy is very pro-active and
future oriented
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3.1.6 RAJASTHAN
RAJASTHAN SOLAR POLICY 2011
The policy aims at developing Rajasthan as a global hub of solar power of 10,00012,000 MW capacity in next 10-12 years to meet energy requirements of Rajasthan and
India. To achieve grid parity in next 7-8 years, the State will encourage the Solar Power
Developers to establish manufacturing plant of their technology in Rajasthan.
This Policy document is aimed at giving a direction to the above stated ambition of the
Rajasthan state.
Salient Features:
The Policy will come into operation with effect from 19.4.2011 and will remain in force
until superseded or modified by another Policy.
To achieve the objectives of this Policy, the targets under the policy are mentioned
below:
1. The State Government has sanctioned two Solar Power Projects of 5 MW capacity
under the GOI guidelines for Generation Based Incentive scheme for Grid Interactive
Solar Power Generation Projects issued by MNRE. The power evacuation transmission
line from generating plant sub-station to the receiving RVPN/Discoms of Rajasthan substation will be laid by STU/Home Discom as per the prevailing orders of RERC.
2. The Rajasthan State has sanctioned 66 MW solar power projects in compliance of the
RERCs orders. These sanctioned projects were migrated to National Solar Mission by
the State Government. The power produced from these solar power plants shall be
procured by NVVN as per mechanism provided under National Solar Mission Phase-1.
The Discoms of Rajasthan shall purchase this solar power from NVVN along with the
equivalent amount of MW capacity from the unallocated quota of NTPC stations allotted
to NVVN by Ministry of Power, GoI. The power evacuation transmission line from
enerating plant sub-station to the receiving RVPN/Discoms of Rajasthan sub-station will
be laid by STU/Home Discom as per the prevailing orders of RERC.
3. The Rajasthan State will develop 50 MW SPV and 50 MW Solar Thermal Power
Plants through selection of developer(s) by the tariff based competitive bidding
process on concept of bundling of Solar Power with equivalent amount of MW capacity
of conventional power. The successful bidder will set up Solar Power Plant in Rajasthan
and supply equivalent amount of MW capacity of conventional power from Conventional
Power Plants located anywhere in India. The power evacuation transmission line from
generating plant sub-station to the receiving RVPN/Discoms of Rajasthan sub-station
will be laid by STU/Home Discom as per the prevailing orders of RERC.
4. The Rajasthan State will promote setting up of Solar Power Plants connected at 33 kV
& above level under the guidelines of National Solar Mission (NSM). The
minimum/maximum capacity allocation to each Solar Power Producer will be as per
MNRE guidelines. The power evacuation transmission line from the Generating plant
sub-station to the RVPN/Discom receiving Sub-station will be laid as per provisions of
the orders of appropriate Commission.
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5. The state government will support setting up of 100 MW solar photovoltaic power
plants and 100 MW solar thermal power plants under phase I of the Rajasthan Solar
Energy Policy 2011 for direct sale of power to discoms in the state. Under phase II
(2012-2017), the state government plans to add another 400MW of solar power through tariff
based competitive bidding process. The power evacuation transmission line from generating plant
sub-station to the receiving RVPN/Discoms of Rajasthan sub-station will be laid by STU/Home
Discom as per the prevailing orders of RERC.
6. The Rajasthan State will promote Solar Power Producers to set up Solar Power Plants of unlimited
capacity for captive use or sale of power to 3rd party/States other than Rajasthan. There will be no
upper ceiling for power projects. The power evacuation transmission line from the Generating plant
sub-station to the RVPN/Discom receiving Sub-station will be laid as per provisions of the orders of
appropriate Commission.
7. The Rajasthan State will promote deployment of Roof-top and Other Small Solar Power Plants
connected to LT/11kV Grid as per guidelines of MNRE under Rooftop PV & Small Solar Generation
Programme (RPSSGP) of NSM. The minimum/maximum capacity for power project sanctioned under
this category will be as per the guidelines issued by MNRE. The power evacuation transmission line
from generating plant sub-station to the receiving RVPN/Discoms of Rajasthan sub-station will be laid
by STU/Home Discom as per the prevailing orders of RERC.
8. The State will promote setting up of small solar power plants connected at 11 kV grid of 1 MW
capacity each for direct sale to State Discoms of Rajasthan. The total capacity under this category will
be 50 MW. The selection of the projects will be through tariff based competitive bidding process.
There will be no upper ceiling for power projects.
9. The Rajasthan State will promote Solar Power Producers to set up Solar Power Plants of unlimited
capacity for sale through RE (Solar) Certificate mechanism. The power evacuation transmission line
from the Generating plant sub-station to the RVPN/Discom receiving Sub-station will be laid as per
provisions of the orders of appropriate Commission
10. The Rajasthan State will promote Solar Power Producers to set up Solar Power Plants along
with Solar PV manufacturing plants in Rajasthan. The target under this category will be 200 MW up
to 2013. The capacity allocation for manufacturing plant will be as follows:-
50 MW and above
20 MW
The selection of developers shall be through tariff based competitive bidding. The Solar
Power Producer will be required to source SPV modules from their own manufacturing
unit established in Rajasthan. The power evacuation transmission line from generating
plant sub-station to the receiving RVPN/Discoms of Rajasthan sub-station will be laid by
STU/Home Discom as per the prevailing orders of RERC.
11. The Rajasthan State will also promote decentralized and off-grid solar
applications, including hybrid system such as solar water heaters, solar cooling
systems, air drying, steam cooking, power generation, sterling engine. The off-grid solar
applications shall be promoted for replacement of diesel based generators sets. The
40 | P a g e
Rajasthan State will also consider incentives for promotion of decentralized and off grid
solar applications.
12. Rajasthan also intends to set up Pilot Demonstration Projects under National
Solar Missions R&D initiatives in Phase 1 of Solar Mission. This will include :
a. 50-100 MW Solar thermal plant with 4-6 hours storage (which can meet both morning
and evening peak load and increased plant load factor up to 40%)
b. A 100 MW Parabolic trough technologies based solar thermal plant
c. A 100-150 MW Solar hybrid plant with coal, gas or bio-mass to address variability and
space-constraints.
d. 20-50 MW Solar plant with or without storage, based on central receiver technology
with molten salt/steam as working fluid and other emerging technologies.
e. Grid connected rooftops PV systems on selected Government buildings and
installations, with net metering
f. Solar based space cooling and refrigeration systems
The capacity allocation for pilot demonstration project will be finalized in consultation
with MNRE.
The maximum capacity to be commissioned under this Clause will be decided by the
Rajasthan Government after studying the subsidy pattern for these demonstration
projects under NSM
13. The Rajasthan State will develop Solar Parks (with RREC as nodal Agency) of more
than 1000 MW capacity in identified areas of Jodhpur, Jaisalmer, Bikaner and Barmer
districts in various stages. RREC will allocate budget for development of infrastructure in
Solar Parks to SPV.The SPV will develop the initial infrastructure from the funds
allocated by RREC, which will be subsequently recouped from the Solar Power
Producers whose project are located in Solar Parks by levying development charges.
14. The Rajasthan State will promote Solar Water heating system by adopting the key
strategy of making necessary policy changes for mandatory use of solar water heating
system (SWHS) on Industrial, commercial, residential and other establishments.
The policy also, specifies minimum/maximum capacity to each Solar Power Producer for
power projects sanctioned under various categories mentioned above.
Developmental charges:
For Solar power projects established for sale of solar power to parties other than
Discoms of Rajasthan, the Solar Power Producer shall deposit non-refundable
development charge of Rs. 10 Lacs per MW to Rajasthan Renewable Energy
Corporation Ltd. within one month from the date of issue of in-principle clearance for
availing benefits, facilities and concessions under the provisions of this policy. For solar
41 | P a g e
power projects established for sale of solar power to Discoms of Rajasthan State, no
development charges will be leviable from the Solar Power Producers.
Creation of Rajasthan Renewable Energy Infrastructure Development Fund:
The resources mobilized by collection of development charges will be credited to
Rajasthan Renewable Energy Infrastructure Development Fund. This fund will be utilized
for creation of infrastructure such as transmission network, roads etc. for accelerated
development of renewable energy.
Land:
Government Land: After registration of the project, RREC will recommend to the
concerned District Collector for reservation of the land identified by the Solar Power
Producer. The District Collector will set apart the land for the project for a period of three
years after examining its suitability for allotment under Rajasthan Land Revenue
(Allotment of Land for setting up of Power plant based on Renewable Energy Sources)
Rules, 2007, as amended from time to time. The Revenue Department may extend the
period of reservation on recommendation of RREC. After expiry of the period of
reservation, the land will be released for use by other developers and for other
purposes. The process of reservation of land will be completed by the concerned District
Collector within the 30 days from the receipt of recommendation of RREC.
After registration of land, the allotment of land to the Solar Power Projects will be done
as per the provisions of Rajasthan Land Rules, 2007, as amended from time to time.
The Government land required for Solar Power Plant shall be allotted to Solar Power
Producer at concessional rate of 10% of the DLC rate (agriculture land).
Private Land: Power Producers shall be allowed to purchase private land from the
Khatedar for setting up of Solar Power Plants in excess of ceiling limit prescribed in the
Ceiling Act, 1973. Conversion of private land to industrial use shall be required for
setting up of Solar Power Plant/Solar manufacturing plant before start of work. The
conversion charges shall be 10% of charges levied for Industrial purpose under the
relevant rules.
Land for Manufacturing unit: Land in RIICO industrial area, in solar parks and will be
as per respective regulations.
Receiving sub-station:
o For 33kV and above grid connected solar plants , RVPN shall finalize the location of
receiving Sub-station in consultation with RREC on which the electricity generated will
be received at minimum 33 kV level
o For 11kV grid connected solar plants, Discoms of Rajasthan shall finalize the location
of receiving station for small solar power plant in consultation with RREC.
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Grid Connectivity:
For creation of proper facility for receiving power, the Solar Power Producer shall pay
Grid Connectivity charges as finalized by RERC from time to time to Discoms of
Rajasthan/RVPN as applicable.
The power evacuation transmission line from generating plant sub-station to the
receiving RVPN/Discoms of Rajasthan sub-station will be laid by STU/Home Discom or
as per the prevailing orders of RERC.
For grid connectivity/construction of line to be arranged by RVPN/ Discoms of Rajasthan, the Solar
Power Producer shall submit time-frame for construction of their plant along with Bank Guarantee
equivalent to the cost of bay and transmission/ distribution line with an undertaking to use the system
within prescribed period. In case there is any delay in utilization of system, a penalty @ 12% per
annum for the period of delay on the amount of Bank Guarantee will be levied by RVPN/ Discoms of
Rajasthan. The Bank Guarantee shall be returned to the Solar Power Producer after commissioning
of the project on depositing amount of penalty, if any on account of delay in the utilization of the
system.
Water Availability:
Water Resource Department will allocate required quantity of water from IGNP canal/the nearest
available source for development of Solar Thermal Power Plants subject to the availability of water for
power generation.
Electricity Duty:
The energy consumed by the Power producers for own use will be exempted from payment of the
electricity duty.
Open Access charges and losses:
As approved by RERC from time to time.
Metering of Electricity:
Metering arrangement shall be made as per Central Electricity Authority (Installation & Operation of
Meters) Regulations, 2006, the grid code, the metering code and other relevant regulations issued by
RERC/CERC in this regard
Reactive power charges:
As per RERC order.
Sharing of CDM benefit:
Solar Power Producer will pass CDM benefit to DISCOM with whom PPA is signed as per appropriate
commissions order.
Forecasting and scheduling:
The Solar energy generated for sale will not be covered under scheduling procedure for Intra-State
RREC to act as Nodal Agency for Single Window Clearance of Projects
The detailed policy document and amendments (First & Second Amendment) can be downloaded
from the following link:
Rajasthan Solar Policy 2011
First Amendment to Rajasthan Solar Policy 2011
Second Amendment to Rajasthan Solar Policy 2011
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PROs
Government to provide land at concessional rates
Bank Guarantee deposit is comparatively low at Rs. 5 lakhs per MW.
Surplus energy can be sold outside state.
Banking is allowed.
CONs
The policy has been amended many times
instability to the investor.
The policy doesnt provide guidelines for
A penalty of Rs. 5 lakhs per MW, if
project approval.
eligible producer.
land without
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3.1.7 HARYANA
Solar Energy
The solar insolation level in the State is in the range of 5.5 KWH to 6.5 KWH per sq.mtr. of
area and the State has about 320 clear sunny days in a year. This offers a great potential for
using solar energy for various thermal and electrical energy applications in the State
NODAL AGENCY
Haryana Renewable Energy Development Agency (HAREDA) shall be the State Nodal
Agency for co-ordinating all activities relating to Renewable Energy Development including
generation of power using non-conventional energy sources. HAREDA shall be responsible
for laying down the procedure for inviting the proposals from Independent Power Producers
(IPPs), DPR preparation, evaluation of project proposals, project approvals and project
progress monitoring etc.
OPERATIVE PERIOD:
The scheme of promotional and fiscal incentives as contained herein will come into
operation with the date of its notification in the official gazette and will remain in force till a
new policy is notified
ELIGIBLE PRODUCERS:
Those who intend to generate electricity from Non-conventional Energy Sources such as
Solar, Wind-Electric Generators, Biomass Combustion, Cogeneration, Municipal and
Industrial Waste, Small Hydro (upto 25 MW) and New Technologies like Bio-oil, Fuel Cell
etc. There will be no restriction on generation capacity or supply of electricity to the grid.
There shall be no restriction on legal structure of entrepreneur in generation of power.
Companies, Cooperatives, partnerships, Local Self Governments, State Nodal Agency,
Boards & Corporations, Power utilities, Private developers, Public
Private Partnership
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GRID INTERFACING:
connection points from the points of generation to HVPN, UHBVN, DHBVN and any other
licensee nearest Light/High Tension lines etc. as well as maintenance of Light Tension lines
will be as per the orders of the Haryana Electricity Regulatory Commission/Central
Electricity Regulatory Commission/ Appellate Tribunal for Electricity on Renewable Energy
Tariff & other issues, as modified from time to time
33/11 KV or
producers.
iii) Two sets of separate meters will be installed on the H.T.side by the
meters and check meters. In case of co-generation/
producer, as main
separate meters will be installed, one for export of power and other for import of power.
iv) Necessary current limiting devices will be installed in the generating equipment by the
producer. Capacitors of sufficient rating will also be provided in the equipment to ensure that
the power factor is always maintained above 0.8.
v) There shall be no restriction on the generation capacity of the project.
WHEELING CHARGES:
Licensee/ Utilities will undertake to transmit on its grid the power generated by power
producers using non-conventional energy sources and make it available to the producer for
captive use or to a Third Party within the State as per approved tariff including surcharge,
additional surcharge, if any, notified by HERC from time to time. If H.T./ L.T. lines required to
be laid beyond Licensee/ Utilities lines for wheeling the power at any desired point, then the
cost of the same shall have to be borne by the promoter/ power producer. In case, the power
is to be sold to a third party, the name of such party shall be indicated by the power producer
at the time of making an application in the prescribed form of Licensee/ Utilities. However,
inrespect of third party sale, licensee/ utilities would have preference over the power
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generated by the power producers and third party sale would be allowed when the surplus
power is not being evacuated by the licensee/ utilities
PURCHASE PRICE:
(i) New Projects
Licensee/ Utilities will purchase electricity offered by the power producers in case of new
projects set up after the notification of the present policy at the rate to be decided by the
Haryana Electricity Regulatory Commission as per provisions in the New Electricity
Act,2003.
(ia) HAREDA shall invite proposals from IPPs through competitive bidding routeand the
IPPs will be asked to offer their most competitive rate on which they want to sell power to the
State Power Utilities and the offered rate should not be more than the tariff decided by the
HERC from time to time.
(ii) For old captive/co-generation projects which are having surplus power to offer for sale to
the power utilities, the tariff shall be negotiated tariff based on negotiation between the
power producers and the power utilities.
BANKING:
HVPNL/ DHBVN/ UHBVN/ licensee is to permit electricity generated by eligible producers to
be banked. The banking facility shall be allowed for a period of one year by the Licensee/
Utilities free of cost. However, withdrawal of banked power should be allowed only during
non-peak hours. If the banked energy is not utilized within a period of twelve months from
the date of power banked with theconcerned power utilities/ licensee, it will automatically
lapse and no charges shall be paid in lieu of such power
ELECTRICITY DUTY:
Non-conventional energy sources power generation and its sale to the Licensee/ Utilities or
third party or for its captive use shall be exempted from the electricity duty.
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Producer will be allowed to use the water for power generation through micro/ mini/ small
hydel plants. No royalty will be charged on the water used for power generation for nonconsumptive use.
Local Area Development Tax will be exempted on plant, machinery, equipment that has
been capitalized in view of the provisions of section 5(f) of Haryana Act No.13 of 2000.
1 The State Govt. will acquire land if necessary at the cost of Independent Power
Producers (IPP) if a request to that effect is made. 2 Setting up of Renewable Energy
Power Projects in the State will be permitted by
PROs
State government will provide assistance for
procurement of land.
No electrical duty.
LADT exempted.
Change of land use charges, external development
CONs
The operative period is not given in the policy, hence new policy can be anticipated
anytime which creates uncertainty.
The plant capacity must be greater than 1 MW for grid interfacing.
Haryana policy for renewable is focused on improving solar potential of the state by
providing various incentives and land assistance. There is requirement of an investor friendly
and comprehensive solar policy as till date the state has abysmal installed capacity
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3.1.8 BIHAR
Bihar Policy for promotion of New and Renewable Energy Sources 2011
This policy will be applicable to all New and Renewable Energy projects. The policy shall be
applicable for any industry, institution Private Agency, partnership firm, consortia, Panchayat
Raj institutions, Urban Local bodies, co-operative or registered society desirous of installing
and generating electricity from New and Renewable Energy Sources
Land
1 .Government land in the industrial area, if available and identified by the developer, may be
leased in accordance with Government of Bihar policy for the allotment of land.
2 .The project developer may purchase private land directly from the owners, on their own
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Project approval:
1 . The project developer shall be required to submit the application to State investment
promotion Board (SIPB), Department of Industries, Government of Bihar along with a prefeasibility report, applicable processing fee & site details. The nodal agency for evaluation
and recommendation
Development Agency ( BREDA), except for mini/micro/small hydro projects for which Bihar
State Hydro Electric Power Corporation (BSHPC) shall be the nodal agency.
2 The project developers, who have received the project approval from SIPB without
specifying the site/location of the proposed projects, shall be required to identify the
site/location and duly inform about the same to SIPB for approval within a period of one (1) month
from the date of notification of this policy
1 T.he project developer shall necessarily offer to supply to Bihar State Electricity Board
(BSEB)/
New and
Renewable Energy project, except for captive projects, However, the acceptance
of such offer
Licensee.
2 The sale of power from such generation project to the grid or using the greed for wheeling
of power the third parties will require the project developer to design and construct the
system at its own cost, such that interfacing with the State grid/BSEB grid is done as per the
latters pecifications & requirements/Indian Electricity Grid Code/ Bihar Grid Code as
applicable and amended from time to time.
3 The capital cost of transmission system for evacuation of power to the nearest grid/ substation including all metering & protective instruments shall be born by BSEB, which shall
be reimbursed to BSEB by the State Government, provided that the project developer offer to
supply BSEB/ Distribution Licensee at least 50%, subject to a minimum of 2 MW, of power
generated from New and Renewable Energy projects. Else the entire project cost of
transmission system for
metering & protective instruments shall be born by the project developer. Sale/wheeling of
Power
1 .Captive power project developer may sell the generated power to the State grid/BSEB after
the captive consumption, if the power available is more than 1 MW.
2 .The project developer may sell to third party/utilize generated power at the place of
generation or at any other place for the captive use, through BSEB network on payment of
applicable Open Access charges surcharges & additional surcharge and any other charges as
approved/notified by Bihar Electricity Regulatory commission (BERC) and as per BERC
(Terms & Conditions for
provided that the third party must be an HT consumer procuring at least 1MW power. The
Project Developer shall execute an
Project Monitoring
1 All New and Renewable Energy projects shall be required to adhere to the following
schedule
which is applicable from the date of notification of this policy or the date of SIPB
Activity milestones
52 | P a g e
* Zero date shall be the date of notification of this policy or the date of SIPB approval,
whichever a later.
Incentives/applicability
The incentives and there applicability to all New and Renewable Energy projects are as
under:-
1 All New and Renewable Energy projects will be entitles for benefits, available as notified
from
2 All New and Renewable Energy projects shall be entitled to avail the facilities available
under prevalent Industrial Incentive Policy, and such other policies of the Govt. of Bihar,
3 BREDA/BSHPC will provide necessary information and assistance regarding identification
and selection of feasible sites.
4 The electricity generated from the New and Renewable Energy projects shall be exempted
from electricity duty.
5 Entry tax on New and Renewable Energy sources devices and or equipment and or
machinery shall be exempted.
6 Loans as per guidelines and incentives or schemes of the Government of India and or
Government of Bihar, India Renewable Energy Development Agency (IREDA) and Ministry
of New and Renewable Energy Govt. of India (MNRE) will be offered/ available for proposal
of power generation through New and Renewable Energy Sources.
7 In case of power generation from mini/micro/small hydel schemes, project developer shall
be allowed to use canal water- fall or river water flow subsequent to the approval and
agreement with Water resources Department, Government of Bihar. However, the water will
be released based on irrigation demand.
8 The provision of section 14 of Electricity Act 2003 for generation and distribution of
electricity in rural areas will be applicable of all New and Renewable Energy projects
53 | P a g e
.1 BSEB/Distribution Licensee shall endeavor to procure and supply the power from New
and Renewable Energy Sources, more than the minimum quantum prescribed under the RPO
obligations by BERC, with the approval of Government, in line with tariff approved by
BERC. Due grid strengthening and up gradation in the transmission & distribution system
shall be undertaken by BSEB/Distribution Licensee to the extent of power procured by
BSEB/Distribution Licensee from respective New and Renewable Energy Project.
2 The project developer will be allowed to draw energy for their consumption during
maintenance/shut down period of the project, where BSEB/ Distribution Licensee is
procuring power from that generating station , at the rate/tariff as approved by BERC for such
New and RenewableEnergy project, However, if BSEB/Distribution Licensee is not
procuring power from that particular generation station, the drawl of energy for their
consumption during shut down/maintenance period shall be at the applicable UI rate (as
approved by CERC) plus 5% of maximum UI rate or the applicable rate/tariff as approved by
BERC for purchase of power from such New and Renewable Energy project, whichever is
higher.
PROs
State government provides land andassists in land acquisition.
BREDA/BSHPC assists in identifyingsites.
Electricity duty/entry tax exempted.
Loans to be provided as per govt.guidelines
For projects upto 5 MW are relativelyeasily approved
54 | P a g e
CONs
Captive power less than 1 MW cannot be
Bihar government has put stress on solar projects upto 5 MW and has encouraged
entrepreneurship in the region. The policy addresses all major issues but needs to be more
comprehensive with respect to financial and technical aspects
55 | P a g e
3.1.11 MIZORAM
The State Nodal Agency
ZEDA is fully committed to boost the use of non- conventional and RE sources through the
following steps:
intensification of awareness campaigns by undertaking demonstration programmes all over
the state;
utilisation of all promotional schemes offered by MNRE;
installation and commissioning of solar power plants, wind hybrid power
projects etc. in the state;
publication of brochures, booklets and pamphlets giving details of various RE schemes
and
devices available, for the benefit of the public;
allocation of funds and holding of popularisation/demonstration campaigns for effective
implementation of RE programmes; and
56 | P a g e
PROs
Land is provided by state government.
A relatively good rate for power purchase.
PPA for minimum ten yrs or less if developer agrees.
Genuine wheeling charges.
Banking of power allowed.
Electricity duty exempted.
Equipments exempted from state sales tax.
Settlement on monthly basis.
Reduction in contract demand to the extent of
30% of installed capacity.
CONs
Producers above 25 MW are notincluded.
Absence of operative period increases uncertainty
The state of Mizoram is aggressively pursuing solar goal by providing various incentives.
The policy is very genuine in case of providing benefits by state government but does not talk
about the financial aspects. A new solar policy must be issued
57 | P a g e
3.1.1 CHHATTISGARH
CHHATTISGARH SOLAR POLICY 2012-17
The Govt. of Chhattisgarh has released the solar energy policy on 20th November 2012. This
policy will be operative till 31st March 2017. Solar power plants approved, installed and
commissioned during this period would be eligible for the benefits of this policy.
Salient Features:
The state govt. aims to achieve a target solar power generation capacity between 500MW
to 1,000MW by March 2017. This would be achieved through three routes:
- Grid Connected Solar Power Projects for Captive Use, Direct Sale to a licensee or any other
person (Third Party) or a state other than Chhattisgarh.
- Grid connected solar power projects for sale through Renewable Energy (Solar) Certificate
Mechanism. The power generated from these projects can be purchased by State DISCOMs
at Pooled Cost of Power Purchase as determined by CSERC from time to time. CSPDCL will
take a final decision in this regard considering the supply and demand position of power in
the state.
- Solar Parks.
58 | P a g e
The state has considered non-conventional sources of power generation as a priority industry
under the State Industrial Policy 2009-14 and therefore has extended all the incentives
including interest subsidy, fixed capital investment subsidy, exemption from electricity and
stamp duty, exemption/concession in land premium, project report subsidy and technical
patent subsidy. The state govt. will extend these facilities till March 2017 even after the end
of tenure of the Industrial Policy.
Electricity Duty:
State government shall exempt all soar power projects from paying Electricity Duty on
auxiliary consumption and captive consumption within the state.
Following incentives will be extended to those solar power developers who commission their
solar plant by March 2017. These incentives will be in force for a period of 7 years from the
date of implementation of the project:
VAT:
Exemption of VAT by the Commercial Tax Department for all equipments/materials required
for solar power project.
Banking:
Energy banking facility allowed at mutually agreed terms and wherever necessary approval
of appropriate electricity regulatory commission shall be obtained.
Grid Connectivity:
Grid connectivity and evacuation facility shall be provided by the CG Transco or DISCOM at
the cost of project developer. Further, if the developer wishes to lay the evacuation line by
themselves, the same can be done without paying supervision charges to CGTRANSCO.
Land:
Land acquisition and statutory clearances/approvals shall be obtained by the developer of the
solar power plant as per policy of the state. Govt. land will be made available depending on
the availability.
Timeline:
Developers shall be required to commission the project within 24 months from the allotment.
Nodal Agency shall carry out tasks related to:
- Assistance in establishing Right of Way, water supply and connectivity through roads.
The detailed policy document can be downloaded from the following link:
Chhattisgarh Solar Policy 2012-2017
PROs
Government of Chhattisgarh fulfills the land requirement of project.
CSEB carries out the maintenance work of lines and equipment of power evacuation
system.
Electrical duty exempted for five and three Years for plant capacity below 10 MW and 10
MW or above respectively.
There is no restriction on generation capacity
CONs
The policy directives are without operative period and hence there is uncertainty as new
policy can be drafted anytime.
CSEB purchases power at comparatively lower rate of Rs. 2.25 per unit.
Banking of power is not allowed
61 | P a g e
CHAPTER-4
SPO OF VARIOUS STATE, STUDY ABOUT REC ,RRF &
SWOT ANALYSIS
SOLAR PURCHASE OBLIGATION:
Among the various renewable energy resources, solar energy potential is the highest in the
country. In most parts of India, clear sunny weather is experienced 250 to 300 days a year.
The annual radiation varies from 1600 to 2200 kWh/m2, which is comparable with radiation
received in the tropical and sub-tropical regions. The equivalent energy potential is about
6,000 million GWh of energy per year.
The National Action Plan on Climate Change also points out: India is a tropical country,
where sunshine is available for longer hours per day and in great intensity. Solar energy,
therefore, has great potential as future energy source. It also has the advantage of permitting
the decentralized distribution of energy, thereby empowering people at the grassroots level.
With the objective to establish India as a global leader in solar energy, by creating the policy
conditions for its diffusion across the country as quickly as possible Government of India
launched National Solar Mission.
The National Tariff Policy was amended in January 2011 to prescribe solar-specific RPO be
increased from a minimum of 0.25 per cent in 2012 to 3 per cent by 2022. CERC and SERCs
have issued various regulations including solar RPOs, REC framework, tariff, grid
connectivity, forecasting etc. for promoting solar energy. Many States have come up with up
their own Solar Policy.
In view of the ongoing efforts of Central and State Governments and various agencies for
promoting solar energy, Ministry of New and Renewable Energy has undertaken an exercise
to track and analyze the issues in fulfillment of Solar Power Purchase Obligation and
implementation of Solar REC framework in India. This would help various stakeholders to
understand the challenges and opportunities in the development of solar power. It would also
include monitoring of Solar RPO Compliance; analyzing key issues related to the regulatory
framework for solar in various states of India.
62 | P a g e
Gujarat
Favourable
The state has set a high Solar RPO target of 1% which is higher than Tariff policy targets.
Average Pooled Power Cost` definition is in line with the CERC REC Regulation, 2010
The State Agency shall submit quarterly status to the Commission in respect of compliance of
renewable purchase obligation by the obligated entities in the format as stipulated by the
commission.
Neutral/off-putting
The RPO regulations are not applicable on captive as well as open access consumers.
As per the regulation the APPC of previous year would be applicable while determining the
cost of power but in reality GUVNL freezes the APPC for the complete life projects.
If the mentioned minimum quantum of power purchase from solar is not available in a
particular year, then in such cases, additional wind or other energy, over and above their
RPO, shall be utilized for fulfillment of the solar RPO.
63 | P a g e
Karnataka
Favorable:
The State Agency shall submit quarterly status to the Commission in respect of compliance of
renewable purchase obligation by the obligated entities in the format as stipulated by the
Commission.
Average Pooled Power Cost` definition is in line with the CERC REC Regulation, 2010
Neutral/off-putting
A distribution licensee may in case of non-availability of solar power generated in the State
of Karnataka procure from other renewable sources of energy or REC to the extent of
shortfall in its RPO in any year.
Captive users can sell their surplus power only to the distribution companies (ESCOMs) at a
price not exceeding the APPC
RECs accreditation can be achieved only to the generators selling the power to ESCOMS at
pooled cost of power purchase as approved by the Commission for the previous
64 | P a g e
Rajasthan
Favourable:
At the end of each financial year, each obligated entity shall submit a detailed statement
regarding total electricity drawn / consumed and renewable energy /REC purchased and duly
certified by the auditors to the State agency on or before ensuing 30th September.
Solar RPO target (on DISCOMS only) of 0.75% in 2012-13 is higher than Tariff policy
target.
Each Distribution Licensee shall indicate, along with sufficient proof thereof, the estimated
quantum of purchase of renewable energy for the ensuing year in tariff/ARR petition in
accordance with Regulations notified by the Commission
The State Agency shall submit quarterly status to the Commission in respect of compliance of
renewable purchase obligation by the obligated entities in the format as stipulated by the
Commission and may suggest appropriate action to the Commission if required for
compliance of the renewable purchase obligation.
The State agency shall develop methodology for collection of information from renewable
energy generating company, obligated entities, SLDC etc. on regular basis, compile the
information to compute the RPO fulfillment by the obligated entities indicating separately the
direct purchase of renewable energy as well as purchase through REC mechanism. The
information shall be placed on a cumulative basis for each quarter by the State Agency on its
website.
Neutral/off-putting
There is separate RPO for bio-mass and that can be fulfilled by purchase of power from
biomass plant only and not by purchase of REC.
In case of genuine difficulty in complying with the renewable power purchase obligation
because of nonavailability of renewable energy and/or certificates, the obligated entity can
approach the Commission to carry forward the compliance requirement to the next year or
seek its waiver.
The shortfall in RPO obligation can be fulfilled by purchase of renewable energy and/or REC
up to 30th June of the next financial year.
Pooled Cost of Power Purchase means the weighted average price at which the distribution
licensee has purchased the electricity including cost of self generation, if any, in the previous
year from all the energy suppliers, excluding short term power purchases and those based on
renewable energy.
Haryana
Favorable:
It is clearly mentioned that Non-fossil fuel based co-generation project shall qualify for
Renewable Energy source.
The State Agency shall submit quarterly status to the Commission in respect of compliance of
renewable purchase obligation by the obligated entities in the format as stipulated by the
Commission and may suggest appropriate action to the Commission
Average Pooled Power Cost` definition is in line with the CERC REC Regulation, 2010
Neutral/off-putting
In case of genuine difficulty in complying with the renewable purchase obligation because
limited availability of renewable energy or non-availability of certificates, the obligated entity
66 | P a g e
can approach the Commission for relaxation or carry forward of compliance requirement to
the next year. This provision of seeking relaxation is not desirable.
Bihar
Favorable:
The Certificates purchased by the obligated entities from the power exchange in terms of the
regulation of the Central Commission shall be deposited by the obligated entities to the
Commission within a month of the purchase of the certificate.
The regulator has also defined a longer trajectory till 2021-22 for the solar RPO target with a
base of 0.25% in 2012-13 and an increase of 0.25% every year till 2019-20 and 0.5% in
2020-21 and 2021-22.
If the distribution licensee is unable to fulfill the obligation, the shortfall of the specified
quantum of that year would be added to the specified quantum for the next year. However,
credit for
excess purchase from renewable energy sources would not be adjusted in the ensuing year.
The State Agency shall submit quarterly status to the Commission in respect of compliance of
renewable purchase obligation by the obligated entities in the format as stipulated by the
Commission and may suggest appropriate action to the Commission if required for
compliance of the renewable purchase obligation.
Average Pooled Power Cost` definition is in line with the CERC REC Regulation, 2010
Neutral/off-putting
If solar certificates are not available in a particular year, then in such cases, additional nonsolar certificate shall be purchased for fulfillment of the Renewable Purchase Obligation
(RPO).
67 | P a g e
JERC( Mizoram)
Favorable:
The regulator has defined a Solar RPO target of 0.25% for 2012-13 in line with the Tariff
Policy.
The State Agency shall devise appropriate protocol for collection of information from
various sources such as renewable energy generating companies, obligated entities, SLDC,
etc., on a regular basis and compile such information to compute the compliance of RPO
target by such Obligated Entities.
Average Pooled Power Cost` definition is in line with the CERC REC Regulation, 2010
Neutral/off-putting
Chhattisgarh
Favorable:
The state has set a target of 0.5% for Solar RPO (by 2012-13)which is higher than that
stipulated in the Tariff Policy.
Average Pooled Power Cost` definition is in line with the CERC REC Regulation, 2010
The State Agency shall develop suitable protocol for collection of information from various
sources such as renewable energy generating companies, obligated entities, SLDC, chief
electrical inspector etc., on regular basis and compile such information to compute the
compliance of RPO target by such Obligated Entities.
In the event of non compliance of the RPO by distribution licensees by any of the modalities,
from non-solar renewable energy plants or solar power plants in the State, the distribution
licensee whose purchase of renewable energy is maximum during the year shall be
68 | P a g e
Neutral/off-putting
The state has set a very short trajectory for RPO targets i.e. till 2012-13.
69 | P a g e
Projected
Demand*
(MU)
Solar RPO
Target
(2012-13)
2012-13
Andhra Pradesh
Capacity
required for
meeting
Solar RPO
(MW)
247.39
148.6
0.63
0.4
10.21
6.1
114.54
68.8
105.87
63.6
42.90
25.8
0.25%
98,956
Arunachal Pradesh
Assam
Bihar
Chhattisgarh
Delhi
JERC (Goa & UT)
Gujarat
Haryana
51.44
30.9
799.19
480.2
Himachal Pradesh
301.25
181.0
21.62
13.0
36.43
21.9
Karnataka
66.96
40.2
Kerala
162.88
97.9
52.65
31.6
Madhya Pradesh
320.15
192.3
Maharashtra
377.47
226.8
Manipur
1.52
0.9
Mizoram
1.04
0.6
Meghalaya
8.62
5.2
Nagaland
1.49
0.9
Orissa
36.43
21.9
Punjab
33.66
20.2
Rajasthan
412.93
248.1
Sikkim
Tamil Nadu
45.72
27.5
Tripura
1.01
0.6
Uttarakhand
5.77
3.5
Uttar Pradesh
859.02
516.1
West Bengal
-31.60
9.33
-83.05
442.25
0.00
7.36
17.06
0.61
-1.58
5.05
93.375
0.00%
41,896
-56.11
13.00
5.05
1.00%
85,902
0.90
-
0.05%
11,541
5.18
-
20.105
0.10%
1,010
0.63
-
0.05%
91,441
0.91
-
331.15
0.00%
436
151.29
34.50
51.825
0.75%
55,057
-19.40
11.75
78
0.07%
48,089
31.61
0.03
0.15%
24,284
-61.14
14.00
0.25%
596
4.23
16.00
0.40%
2,154
21.89
-
0.25%
418
12.99
-
75.5
0.25%
608
172.20
7.80
211.75
0.25%
1,50,987
-488.33
824.09
0.025
0.60%
53,358
29.22
1.69
159
0.25%
21,060
2.53
36
0.25%
65,152
34.61
4.00
1.00%
6,696
68.82
-
0.25%
14,573
1.14
-
8.8
0.25%
8,647
0.35
0.03
968.5
0.75%
40,167
70.94
23.35
1.685
1.00%
79,919
(MW)
2.525
0.40%
12,860
MW
29
0.15%
28,598
(MW)
0.50%
21,174
Gap to be
fulfilled in
2012-13
0.75%
15,272
Installed
capacity as
on 09.03.2013
0.025
0.15%
6,810
Total Capacity
Tied Up as on
09.03.2013*
77.7
0.10%
631
Jammu and
Kashmir
Jharkhand
Solar
RPO
Target
(2012-13)
(MU)
422.74
12.38
52.05
-52.05
2.00
Total
2,474.6
2,207.07
1,440.81
70 | P a g e
Government of India has come out with Acts, Policies and regulations to support renewable.
The major contributors are as under
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The enactment of the Electricity Act 2003 (The Act) has accelerated the process of reform in
the Indian power sector. The Act has enabled competition in the Indian power sector in bulk
as well as retail electricity supply, in phases. To meet the challenges in the emerging
competitive environment, the Act promotes electricity generation from renewable energy
sources through following enabling provisions:
(i) The SERCs to specify, for purchase of electricity from such sources, a percentage of the
total consumption of electricity in the area of a distribution licensee (Sec.86 (1) (e)).
(ii) The SERCs to promote co-generation and generation of electricity through renewable
sources of energy by providing suitable measures for connectivity with the grid and sale of
electricity to any persons (Sec. 86(1) (e)).
(iii) The terms and conditions for the determination of tariff to be prescribed by the SERCs to
promote co-generation and generation of electricity from renewable sources of energy (Sec.
61(h))
.(iv) The National Electricity Policy (NEP) to be formulated by the central government, in
consultation with the state governments for development of the power system based on
optimal utilisation of resources including renewable sources of energy (Sec. 3(1)).
(v) The Central Government to prepare a national policy, in consultation with the state
governments, permitting stand alone systems (including those based on renewable sources of
energy and other non-conventional sources of energy) for rural areas (Section 4)
The National Electricity Policy 2005 stipulates that progressively the share of electricity from
non-conventional sources would need to be increased; such purchase by distribution
companies shall be through competitive bidding process; considering the fact that it will take
some time before non-conventional technologies compete, in terms of cost, with conventional
sources, the commission may determine an appropriate deferential in prices to promote these
technologies.
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The National Action Plan of Climate Change (NAPCC) has set the target of 5% renewable
energy purchase for FY 2009-10 which will increase by 1% for next 10 years. The NAPCC
further recommends strong regulatory measures to fulfil these targets. For the development of
Non-conventional energy sources, efforts need to be made to reduce the capital cost of such
projects. Cost of energy can also be reduced by promoting competition within such
projects. At the same time, adequate promotional measures would also have to be
taken for development of technologies.
73 | P a g e
cost of electricity
generation by
renewable sources
cost equvalent of
conventional source
cost of enviromental
component
ii) To sell electricity generation and environmental attributes associated with RE generations
separately.
The environmental attributes can be exchanged in the form of Renewable Energy
Certificates (REC).
There shall be two categories of certificates, viz., solar certificates issued to eligible entities
for generation of electricity based on solar as renewable energy source, and non-solar
certificates issued to eligible entities for generation of electricity based on renewable energy
sources other than solar
74 | P a g e
solar
generator
sale on
preferencial
tariff
obligated
entity
sale without
preferencial
tariff
electricity
component
REC
component
distribution
company /third
party sale
obligated
entity
REC will be issued to the RE generators for 1 MWh of electricity injected into the grid from
renewable energy sources.
The Certificate once issued shall remain valid for three hundred and sixty five days from the
date of issuance of such certificate.
REC would be issued to RE generators only.
REC could be purchased by the obligated entities to meet their RPO under section 86 (1) (e)
of the Act. Purchase of REC would be deemed as purchase of RE for RPO compliance.
Grid connected RE Technologies approved by MNRE would be eligible under this scheme.
RE generations with existing Power Purchase Agreement on preferential tariff are not
eligible for REC mechanism.
SERC to recognize REC as valid instrument for RPO compliance.
SERC would define open access consumers, captive consumers as obligated entities along
with distribution companies.
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SERC to designate State agency for accreditation for RPO compliance and REC mechanism
at State level.
CERC has designated National Load dispatch Centre (NLDC) as Central Agency for
registration, repository, and other functions for implementation of REC framework at
national level.
Only accredited project can register for REC at Central Agency.
Central Agency would issue REC to RE generators for specified quantity of electricity
injected into the grid.
REC would be exchanged only in the CERC approved power exchanges.
Central Agency will extinguish the RECs sold in Power Exchanges in its records as per
information provided by the Power Exchanges. The certificates will be extinguished by the
Central Agency in the First-in-First-outorder
Price of electricity component of RE generation would be equivalent to the weighted
average power purchase cost of the discoms including short term power purchase but
excluding renewable power purchase.
REC would be exchanged within the forbearance price and floor price. This forbearance and
floor price would be determined by CERC in consultation with Central agency and FOR
(Forum of Regulators) from time to time.
In case of default, SERC may direct obligated entity to deposit into a separate fund to
purchase the shortfall of REC at forbearance price.
However, in case of genuine difficulty in complying with the renewable purchase obligation
because of non-availability of certificates, the obligated entity can approach the Commission
for carrying forward of compliance requirement to the next year.
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Obligated entities
The entities mandated to purchase a defined quantum of renewable energy of their overall
consumption are Obligated entities. Obligated entities may either purchase renewable
energy or can purchase RECs to meet their Renewable purchase Obligation (RPO) set
under Renewable Purchase Obligation of their respective States. Following entities are
generally obligated in the State:
a. Distribution Licensees
b. Captive Consumers
Eligible entities are those renewable generators who meet following criteria
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RENEWABLE REGULATORY FUND :RRF mechanism is issued in compliance with Regulation 6.1(d)read with Clause 9 of
Complimentary Commercial Mechanism (Annexure-1) of Central Electricity Regulatory
Commission (Indian Electricity Grid Code) Regulations, 2010 (hereinafter termed as the
IEGC 2010).
Applicability:
The Solar generating plants with capacity of 5 MW and above connected at connection point
of 33 KV level and above and who have not signed any PPA with states/UTs or others [for
which declaration has to be submitted to SLDC/Control Centre by the applicant, which in
turn would submit the same to RPC, RLDC and NLDC] as on the date of coming into force of
IEGC,2010 with effect from 3.5.2010
This procedure shall not be applicable to plants selling power through collective transactions
as no revisions in schedules are envisaged in the same and buyers and sellers are anonymous
General Conditions
1. The scheduling jurisdiction and procedure, metering, energy accounting and accounting of
Unscheduled Interchange (UI) charges would be as per the relevant Regulations of the
Central Commission, as amended from time to time.
2. Wind Farm/Solar Energy Generators, which are intra-State entities, shall furnish
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the details of Contracts along with contracted price to the concerned RPC and RLDC through
the respective SLDC. Wind Farm/Solar Energy Generator, which are regional entities, shall
furnish the details of Contracts along with contracted price through the respective RLDC to
the concerned RPC.
3. Special Energy Meters shall be installed by the Central Transmission Utility for and at the
cost of the regional entities and by the State Transmission Utility for and at the cost of the
intra-State entities.
.4. Special Energy Meters installed shall be capable of time-differentiated measurements for
time block wise active energy and voltage differentiated measurement of reactive energy.
5. Wind/Solar Generator shall provide Data Acquisition System Facility for transfer of
information to concerned SLDC.
.6. The concerned SLDC/RLDC will be responsible for checking that there is no gaming
(gaming is an intentional mis-declaration of a parameter related to commercial mechanism in
vogue, in order to make an undue commercial gain).
1 A Fund shall be opened by the National Load Despatch Centre (NLDC) on a national level
known by the Renewable Regulatory Fund (RRF) on the lines of UI Pool Account at the
Regional level. All payments on account of Renewable Regulatory charges, as described in
Para 5.2, levied under the Regulations, and interest, if any, received for late payment shall be
credited to the RRF.
2 The RRF shall be maintained and operated by the National Load Despatch Centre in
accordance with provisions of the Regulations
1. The schedule of solar generation shall be given by the generator based on availability of
the generator, weather forecasting, solar isolation, season and normal solar generation curve
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and shall be vetted by the RLDC in which the generator is located and incorporated in the
inter-state schedule. If RLDC is of the opinion that the schedule is not realistic, it may ask the
solar generator to modify the schedule.
3 In the case of intra-State sale of solar energy, the host State would pay the solar generator
at the contracted rate for actual generation.
4 In the case of inter-State sale of solar energy, the purchasing State would pay the solar
generator at the contracted rate for actual generation. The implication of UI charges due to
the deviation for purchasing State and host State would be settled through the RRF.
2 In addition to the settlement of accounts for Solar generator the host State would
also receive compensation from the RRF for total or part difference between the total
scheduled generation and total actual generation of solar and wind generation collectively in
the State as a whole @ additional UI rate, to the extent subjected to it, if any, on account of
net solar farm under-generation below the frequency specified in the CERC (Unscheduled
Interchange and related matters) Regulation, 2009 for the State as a whole. This would be as
certified by the RPC, in whose region the host State is located
3 The Host State would also receive from the RRF, the difference between the UI rate and
the cap UI rate for under-drawal beyond the percentage/MW prescribed in the UI
Regulations, to the extent of under-drawal subjected to it, if any, on account of net overgeneration by solar and wind farms in the State as a whole. This would be as certified by the
RPC, in whose Region the host State is located.
4 The net leftover amounts in the RRF, whether positive or negative, would be shared among
all the States/UTs of the country/DVC in the ratio of their peak demands met in the previous
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month based on the data published by CEA in the form of regulatory charge (whether
positive or negative), known as the Renewable Regulatory Charge, operated through the
Renewable Regulatory Fund, on a monthly basis
Case 1
Step - 1 : Host State pays to Solar Generator at contracted rate as per actual (i.e.120 MW).
Step 2 : The Host State receives from the RRF, the difference between the UI rate and the cap
rate for under-drawal beyond the percentage prescribed in theUI Regulations, to the extent of
under-drawal subjected to it, if any, on account of net over-generation by solar and wind
farms in the State as a whole. This would be as certified by the RPC, in whose Region the
host State is located.
Case 2
Step - 1 : State pays to Solar generator at contracted rate as per actual generation (i.e. 80
MW).
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Step - 2 : The State receives from RRF for total or part difference between the total schedule
and total actual generation of solar and wind generation collectively in the state as a whole @
additional UI rate, to the extent subjected to it, if any, on account of net solar and wind farm
under-generation for the State as a whole. This would be as certified by the RPC, in whose
Region the host State islocated.
SOLAR GENERATORS Inter-State
Case 1
Step - 1 : Purchasing State pays to Solar Generator at contracted rate as per actual
generation(i.e. 120 MW).
Step - 2 : Purchasing State receives from RRF for the difference (i.e. 20 MW) @ UI rate of its
Region.
Step - 3 : Host State pays to the RRF for difference between the scheduled generation and the
actual generation (i.e. 20 MW) @ UI rate of its Region.
Step 4 : The Host State also receives from the RRF, the difference between
the UI rate and the cap UI rate for under-drawal beyond the percentage prescribed in
the UI Regulations, to the extent of under-drawal subjected to it, if any, on account of
net over-generation by solar and wind farms in the State as a whole. This would be as
certified by the RPC, in whose Region the host State is located.
Case - 2
Generation Schedule -100 MW
Actual Generation 80 MW
Step - 1 : Purchasing State pays to Solar generator at contracted rate as per actual generation
(i.e. 80 MW).
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Step - 2 : Purchasing State pays to RRF for difference (i.e. 20 MW) @ UI rate of its
Region.
Step - 3 : Host State receives from RRF for the difference (i.e. 20 MW) @ UI rate of
its Region.
Step - 4 : The Host State also receives from RRF for total or part difference between the
total schedule and total actual generation of solar and wind generation collectively in
the state as a whole @ additional UI rate, to the extent subjected to it, if any, on account
of net solar and wind farm under-generation for the State as a whole. This would be as
certified by the RPC, in whose Region the host State is located.
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GRID PARITY
Grid parity (or socket parity) occurs when an alternative energy source can generate
lectricity at a levelized cost (LCoE) that is less than or equal to the price of purchasing power
from the electricity grid.
The term is most commonly used when discussing renewable energy
sources, notably solar power and wind power. Reaching grid parity is considered to be the
point at which an energy source becomes a contender for widespread development
without subsidies or government support. It is widely believed that a wholesale shift in
generation to these forms of energy will take place when they reach grid parity.
Grid parity is most commonly used in the
field of solar power, and most specifically when referring to solar photovoltaic (PV). As PV
systems do not use fuel and are largely maintenance-free, the levelized cost of electricity is
dominated almost entirely by the capital cost of the system. If one makes the not-unrealistic
assumption that the discount rate will be similar to the inflation rate of grid power, then one
can calculate the levelized cost simply by dividing the original capital cost by the total
amount of electricity produced over the system's lifetime.
The Indian solar market has seen significant growth with the installed solar PV capacity
rising from under 20 MW to more than 1000 MW within the last two years. In fact, the tariffs
discovered in the highly competitive bidding in the recent rounds of auction under Jawaharlal
Nehru National Solar Mission (JNNSM) and State level programs are already comparable to
the marginal power tariffs applicable for industrial and commercial power consumers in some
states in India.
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Delhi
2013-14
2014-15
24373
26810
0.25
0.3
4.27
4.48
8.75
5.75
60.93
9.3
80.43
9.3
53,31,59,375.00
46,24,72,500.00
26,01,81,775.00
36,03,26,400.00
60.93
80.43
56,66,72,250.00
74,79,99,000.00
82,68,54,025.00
1,10,83,25,400.00
29,36,94,650.00
64,58,52,900.00
1,04,34,56,87,600.00
1,20,21,09,46,100.00
1,04,63,93,82,250.00
1,20,85,67,99,000.00
4.2812
4.48381
4.29325
4.5079
0.0112
0.00381
0.02325
0.0279
29,36,94,650.00
64,58,52,900.00
The above table signifies that the obligated entity should go with direct purchase of solar
rather purchase of REC .
Delhi can develop its own solar potential by PPA with solar developer or by purchasing solar
through open access from nearby states with surplus capacity
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1. Solar market has still a lot of untouched market which can be developed by the solar
developers
2. Various states are supporting solar power through incentive and waiving off taxes this is a
good sign for solar developers
3. With respect to the obligated entity it advisable for them to get into PPA with solar
generators in order to meet their SPO
4. As soon as the grid parity is attain there can be certain changes in the solar market such as
gov. Incentive ,more competitors installation cost can go high
5. Government can promote solar for both roof top as well as standalone (rural area ) to
promote solar and meet SPO
6. Goverment with surplus generation should promote open access or interstate transmission
of solar by waiving of transmission charges
7. Obligate entity can float tender for direct buying of solar in order to meet their SPO
8. States with high land cost or installation cost can go for inter state purchase
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