Monthly RE update – January 2021

Monthly RE update – January 2021

Renewable update july 2020

Tenders

  • About 6,963 MW of renewable tenders were issued in January 2021, including 5 GW of solar tender by IREDA under CPSU scheme. TANGECO also issued 500 MW solar tender under KUSUM scheme.
  • SECI reduced the capacity of 5000 MW RE+Thermal RTC II tender to half of its original capacity.

Details of new tenders issued in January 2021

Source: JMK Research

New RFS Issued

Tender Name

Technology

Tender Scope

Capacity (MW)

Other Details

Minimum CUF

Commissioning timeline from PPA signing

Bid Submission Date

IREDA, 5 GW,  Solar PV Tranche III Phase II, CPSU Program,  Pan India, Jan 2021

Utility Scale Solar

Build Own Operate

5000

EMD – INR 400,000/ MW

PBG- 50% of VGF bid

 

24 months

4th-Mar-2021

GUVNL 500 MW, Solar PV Phase XII, Gujarat, Jan 2021

Utility Scale Solar

Project Development

500

EMD – INR 400,000/ MW

17%

18 months

23rd-Feb-2021

TANGEDCO, 500 MW, Solar under PM KUSUM scheme, Jan 2021

Small Scale Solar

 

500

EMD: INR 1,00,000/ MW

   

18th-Feb-2021

NTPC, 300 MW, ISTS Wind Power Project, Pan India, Jan 2021

Wind

EPC

300

Bid Security Amount – INR 100 million (upto 160 MW capacity)

INR 200 million (over 160 MW capacity)

   

9th-Feb-2021

MAHAGENCO, 250 MW, Solar PV, Maharashtra, Jan 2021

Utility Scale Solar

Project Development

250

PBG – INR 1.05 million

19%

15 months

15th-Feb-2021

NTPC, 190 MW, Grid-connected Solar PV, Rajasthan, Jan 2021

Utility Scale Solar

Project Development

190

PBG – INR 800,000

21%

10 months

10th-Feb-2021

NHPC, 100 MW, ISTS connected Solar PV, Karnataka, Jan 2021

Utility Scale Solar

EPC

100

   

12 months

16th-Feb-2021

SECI, 50 MW, Solar PV and Agro PV, Tamil Nadu, Jan 2021

Solar and Agro PV

Project Development

Solar PV – 40

Agro PV – 10

   

12 months

1st-Mar-2021

MPUVNL, 40 MW, Rooftop Solar, Madhya Pradesh, Jan 2021

Rooftop Solar

RESCO

40

PBG – INR 1.9 million

 

9 months

17th-Feb-2021

SECI, 25 MW, Solar PV, West Bengal, Jan 2021

Utility Scale Solar

EPC

25

   

9 months

10th-Mar-2021

TSCL, 3 MW, Solar Power Project, Tamil Nadu, Jan 2021

Small Scale Solar

 

3

EMD – INR 1.5 million

   

18th-Feb-2021

CREST, 2 MW, Rooftop Solar, Chandigarh, Jan 2021

Rooftop Solar

 

2

INR 200,000

PBG – 3% of the project capital cost

 

4 months

27th-Jan-2021

DMRC, 2 MW, Rooftop Solar, Delhi, Jan 2021

Rooftop Solar

RESCO

2

Performance Security Amount – INR 2.16 million

Ceiling tariff – INR 4/kWh

 

12 months

23rd Feb 2021

MEDA, 1.44 MW, Rooftop Solar, Maharashtra, Jan 2021

Rooftop Solar

 

1.44

EMD – INR 671,357

   

12-Feb-2021

PBG: Performance Bank guarantee
EMD: Earnest Money Deposit
Source: Industry news articles, JMK Research

Retendered

Tender Name

Technology

Tender Scope

Other Details

Minimum CUF

Commissioning timeline from PPA signing

Bid Submission Date

SECI, Pan India, 2500 MW, Thermal + RE, Mar 2020

Thermal + RE

Project Development

EMD – INR 0.5 million/MW

PBG – INR 0.1 million/MW

 

30 months

1-Mar-2021

*The capacity of 5000 MW RE+Thermal Tender has been reduced to half of its original capacity.
Source: Industry news articles, JMK Research

Date extension

Tender Name

Technology

Other Details

Bid Submission Date

SECI, 2500 MW, ISTS, Solar UMREPP, Karnataka (ISTS X), April 2020

Solar

EMD – INR 0.4 million

PBG – INR 0.8 million

26-Feb-2021

SECI, 15 MW, Floating Solar, Bilaspur Himachal Pradesh

Floating Solar

EMD – INR 13.5 million

17-Feb-2021

RITES, 1 GW, Ground mounted solar PV, Zonal Railways across India, Sep 2020

Utility scale solar

EMD: INR 0.4 million

4 Mar 2021

RITES, 400 MW, Ground mounted solar PV, Zonal Railways across India, June 2020

Utility scale solar

EMD: INR 0.4 million

11 Feb 2021

Source: Industry news articles, JMK Research

Results Announced/ Bids Submitted

Tender Name

Status

Capacity won (MW)

Winners Detail

GUVNL, 500 MW, Solar, Gujarat, Phase IX, Sept 2020

Result announced

200

L&T (won from NTPC Limited one of the winners of this tender)

GSECL, 210 MW, Solar, Gujarat, Sept 2020

Result announced

210

L&T

NTPC, 90 MW, BOS package, Anta Solar Park, Rajasthan

Result announced

90

Amara Raja Power Systems

Source: JMK Research

monthly RE

Installed Capacity

In December 2020, a total of 744.71 MW of solar and wind energy capacity was added, taking the cumulative RE capacity to 91.15 GW as on December 31st, 2020.

State-wise installations in Solar and Wind during December 2020 – 744.71 MW

Source: CEA, JMK Research

Gujarat added maximum solar as well as wind capacity in Dec 2020 with a total addition of about 384 MW.

State-wise Installed capacity in Dec 2020

Source: JMK Research

Recently Commissioned Projects

Project Developer Name

Technology

Capacity (MW)

State

Date of Commissioning

Adani

Solar

150

Gujarat

Jan-2021

NTPC

Solar

140

Uttar Pradesh

Jan-2021

SolarArise

Solar

75

Uttar Pradesh

Jan-2021

THDC India Limited (NTPC arm)

Solar

50

Kerala

Jan-2021

Cipla in partnership with AMP Energy

Solar

30

Maharashtra

Jan-2021

Adani

Solar

25

Uttar Pradesh

Jan-2021

Source: Industry news articles, JMK Research

Investments/ Deals

Company Name

Deal Type

Sector

Asset Acquired

Investor

Deal Value

Stakes Acquired

Spinel Energy and Infrastructure (SEIL)

Acquisition

Solar

20 MW

Adan Green Energy (AGEL)

$18.22 million

100%

Source: JMK Research

Tata Capital’s green lending arm gets $ 30 million from CDC

CDC has approved a sum of $ 30 million merit to the Tata Cleantech an arm of Tata Capital under its green lending facility. This amount will help Tata Cleantech to loan businesses across the globe that focuses mainly on e-mobility, water and energy sector. This has been the first green loan facility provided by the British impact investor.

Jinchen, Waaree signed 3 GW – high efficiency PV module line

Jinchen has signed a 3 GW of high efficiency PV modules automatic production deal with India’s largest module manufacturer Waaree Energies Ltd. The agreement will be delivered in April 2021 and it will be formally put in operation by Jun 2021. This will help Waaree to reach its module manufacturing capacity by 5 GW, making them the largest module manufacturer in the overseas market. It will also help to boost the India’s National Solar Target of 175 GW by 2022. 

Compared to November 2020, solar imports have increased by nearly 10% while exports have fallen by 67% in December 2020. Compared to previous year, on a YoY basis, both solar imports and exports have declined by 69% and 97% respectively in 2020.

Exports – Imports trend

Source: Ministry of Commerce, JMK Research

Compared to December 2020, prices of global multi crystalline modules and mono PERC modules have remained the same in January 2021. Compared to previous year, on a YoY basis, prices of global multi crystalline modules and mono PERC modules have declined by 13% and 11% respectively.

Source: PVInfoLink, JMK Research

Monthly SECI Payments

The Solar Energy Corporation of India Limited (SECI) paid nearly INR 3.85 billion to developers for the purchase of solar and wind power in November 2020. Compared to October 2020, the payment disbursal has increased by ~4%.

Monthly payments by SECI to solar and wind developers

Source: SECI, JMK Research

Policies and Regulations

Central

Ministry of Power (MoP) sets RPO and HPO trajectory

  • In light of Tariff Policy, 2016 and with an objective of creating renewable power capacity of 175 GW by March, 2022 Ministry of Power (MoP) had notified long term trajectory of Renewable Purchase Obligation for Solar and Non-Solar power vid its order dated 29 January, 2021.
  • On 8th March, 2019 Government issued Order detailing various policy measures to promote hydro power and also specifying Hydro Power Obligation (HPO). In line of this Order MoP has revised trajectory of RPO including HPO targets considering the Large hydro projects (LHP) which are commissioned after 8th March, 2019.

Year

Solar RPO

Non-Solar RPO

Total RPO

HPO

Other Non-Solar RPO

Total Non-Solar RPO

2019-20

7.25%

10.25%

10.25%

17.50%

2020-21

8.75%

10.25%

10.25%

19%

2021-22

10.50%

0.18%

10.50%

10.68%

21.18%

2022-23

To be specified later

0.35%

To be specified later

To be specified later

To be specified later

2023-24

0.66%

2024-25

1.08%

2025-26

1.48%

2026-27

1.80%

2027-28

2.15%

2028-29

2.51%

2029-30

2.82%

  • As per MoP notification HPO benefits may be met from the power procured from eligible LHPs commissioned on and after 8 March,2019 and upto 31 March, 2030 in respect of 70% of the total generated capacity for a period of 12 years from the date of commissioning.
  • Free power is to be provided as per agreement with the State Government and that provided for Local Area Development Fund(LADF), shall not be included within this limit of 70% of the total generated capacity.
  • Free power (not that contributed for Local Area Development) only to extent of HPO liability of the State/Discom, shall be eligible for HPO benefit.
  • In case the free power, as above, is insufficient to meet the HPO obligations, then the State would have to buy the additional hydro power to meet its HPO obligations or by Hydro Energy Certificate to meet the non-solar HPO.
  • The Hydro Energy Certificate mechanism under Regulation to be developed by CERC to facilitate compliance of HPO Obligation, would have a capping price of Rs.5.50/Unit of electrical energy w.e.f 8th March 2019 to 31st March, 2021 and with annual escalation @5% thereafter for purposes of ensuring HPO compliance.
  • MoP clarifies that the above HPO Trajectory shall be trued up on an annual basis depending on the revised commissioning schedule of Hydro projects. The HPO Trajectory for the period between 2030-31 and 2039-40 shall be notified subsequently. Hydro power imported from outside India shall not be considered for meeting HPO
  • In case of on achievement of Solar RPO compliance to the extent of 85% and above, remaining shortfall, if any, can be met by excess non-solar energy consumed beyond specified Non-
    Solar RPO for that particular year. Similarly, on achievement of Other Non-Solar RPO compliance to the extent of 85% and above, remaining shortfall if any, can be met by excess solar or eligible hydro energy consumed beyond specified Solar RPO or HPO for that particular year.
  • Further, on achievement of HPO compliance to the extent of 85% and above, remaining shortfall, if any, can be met by excess solar or other non—solar energy consumed beyond specified Solar RPO or Other Non-Solar RPO for that particular year.
  • Moreover, CERC may consider to devise suitable mechanism similar to Renewable Energy Certificate (REC) mechanism to facilitate fulfilment of HPO

MoP Considered ISTS Charges Waiver for Solar, Wind Projects Beyond Deadline

  • Ministry of Power with its Order dated 15 January, 2021 clarifies that it will not deprive renewable power projects of a waiver on inter-state transmission system (ISTS) charges and losses if they are commissioned after 30 June, 2023, due to delays caused by the transmission provider or the government agency or due to force majeure.
  • These projects include- solar and wind power projects and solar-wind hybrid projects (with or without storage).
  • The waiver would apply to solar projects commissioned under the second phase of the Ministry of New and Renewable Energy’s Central Public Sector Undertaking Program and for solar projects commissioned SECI’s manufacturing-linked solar tender.
  • If the renewable power project is eligible for ISTS waiver and is granted an extension in commercial operation date, the commencement of the long-term access period would also accordingly get an extension.
  • The Ministry of Power, with its Order dated 5 August, 2020, had waived ISTS charges and losses on all solar and wind projects commissioned before 30 June, 2023. The ISTS charges would be waived for 25 years from their commissioning date for the transmission and sale to entities with renewable purchase obligations (RPO).

State

Jharkhand

Jharkhand sets Levelized Tariff of Rs. 3.09/kWh for Solar Projects Under PM-KUSUM

  • Jharkhand State Electricity Regulatory Commission (JSERC) with order dated 8 January, 2021 has set a pre-fixed levelized tariff of Rs. 3.09 /kWh for power from decentralized solar and other renewable energy projects between 500 kW and 2 MW in size under Component-A of the Pradhan Mantri Kisan Urja Suraksha evem Utthan Mahabhiyan (PM KUSUM) program.
  • The tariff applies to distribution companies (DISCOMs) looking to purchase power from farmers, farmer groups, cooperatives, panchayats, farmer producer organizations, or water user associations in the vicinity of rural grid substations.
  • Pre-fixed Levellised Tariffs Issued by JSERC for Decentralised Solar Projects Under Component-A of KUSUM Scheme
DetailsUnitJharkhand (Proposed)HaryanaRajasthanKarnatakaPunjabTelangana
Tariff ApprovedRs./kWh3.093.113.143.082.753.13
  • JSERC allowed the tariff of Rs.3.09/kWh, stating that this was a more realistic and competitive tariff given the current market climate. JSERC noted that this tariff was only a ceiling tariff for carrying out competitive bidding. The final tariff must be discovered through competitive bidding. This tariff would remain in force until the Commission reviews it.

JSERC approves Net Metering Facility for 2 MW Rooftop Shree Cement Solar Project

  • Jharkhand State Electricity Regulatory Commission (JSERC) with its order dated 9 January, 2021 has approved the net metering connectivity requested by Shree Cement for a captive rooftop solar power project of 1.99 MW at 132 kV voltage supply.
  • Shree Cement had filed a petition requesting the Commission to allow for the net metering facility, regardless of the voltage level, be it 33 kV or 132 kV or even higher.
  • Shree Cement had commissioned a cement grinding unit, for which JBVNL had released a high tension (HT) connection with a contract demand of 14 MVA at a voltage level of 132 kV. The company intends to establish a captive solar power project of 1.99 MW under the net metering regulations of JSERC.
  • It applied for net metering connectivity, to which JBVNL replied that there was no clarity regarding the net metering facility at a connectivity level of 132 kV.
  • JBVNL said that the regulations provide connectivity for net metering at different voltage levels. Still, there was no clarity regarding the rooftop solar system’s connectivity above 1 MW and up to 2 MW at 132 kV level. Given the ambiguity for connectivity at 132 kV voltage level, the petitioner filed the petition to get approval for the solar power project under the net metering facility.
  • Shree Cement said that the proposed 1.99 MW solar captive power project would generate a voltage level of 480 V that would be further stepped up to 11 kV. The generation at 11 kV would then be connected to the cement plant’s 11 kV bus, and the 11 kV bus will be connected with a 132 kV JBVNL system through the existing 11/132 kV, 25 MVA step-up power transformer.
  • The company stated that it had installed two bi-directional meters available at the 132 kV grid interconnection point for the metering system and energy accounting. The meters were capable of recording the import of energy from the grid and export of solar energy to the grid.
  • Jharkhand: Connectivity Levels at which the Rooftop Solar System is to be Connected with the Distribution System
Connected Load/ Contract Demand of Eligible ConsumerConnectivity Level
Up to 5 kWSingle Phase at 230V
5 kW and above up to 50 kW/63 kVA3 Phase, 4 wire at 415 V
Above 50 Kw and upto 1 MW3 Phase at 6.6 kV, 3 Phase at 11 kV
Above 1 MW and upto 2 MW3 Phase at 22 Kv, 3 Phase at 33 kV
  • JSERC said that connectivity would be provided subject to the fulfillment of requirements concerning system protection, data communication, and metering of the Jharkhand Urja Sancharan Nigam Limited (JUSNL), State Load Despatch Center (SLDC), and the Jharkhand Bijli Vitran Nigam Limited (JBVNL) respectively.
  • JSERC said that the regulations provide connectivity of net metering at different voltage levels but do not provide connectivity of a rooftop solar PV system above 1 MW and up to 2 MW at 132 kV voltage level.
  • Considering the submissions, expert report, and no objection by both the distribution companies, the Commission said it was inclined to relax the regulations and grant net metering connectivity irrespective of the voltage level.

Maharashtra

Maharashtra Announces Unconventional Energy Generation Policy, Plans for 13 GW of Solar Projects

  • The Maharashtra State Cabinet has issued its ‘Unconventional Energy Generation Policy’ to promote non-conventional source-based energy generation in Dec, 2020.
  • Aforementioned policy is divided into two parts. In the first part of the policy, the state aims to implement 17,360 MW of transmission system-connected renewable power projects by 2025. This includes 12,930 MW of solar power projects, 2,500 MW of wind energy projects, 1,350 MW of co-generation projects, 380 MW of small hydro projects, and 200 MW of urban solid waste-based projects.
  • Maharashtra Renewable Energy Policy: Transmission – Connected Renewable Energy Projects (Part-1)

Energy Sources

Capacity (MW)

Authority

Solar Projects

12,930

Private Equity, Central Govt. Agencies or Relevant Departments

Wind Projects

2,500

Co-Generation Projects based on Sugarcane Plantations/Agriculture residues

1,350

Small Hydropower Projects

380

Urban solid waste-based projects

200

Total

17,360

  • The 12,930 MW of solar projects include 10 GW of standalone solar power projects, 2 GW of grid-connected rooftop solar projects, 500 MW of solar-based water supply projects, 250 MW of solar generation projects for farmers, among others. The details are furnished below:
  • Maharashtra Solar Policy: Breakdown of Solar-Energy Generation Component Under Part-1

Plan

Capacity (MW)

Authority

To develop Solar Power Generation Projects

10,000

Private Equity

GRID connected Rooftop Solar Projects

2,000

Central Govt.

Urban & Rural Water using Solar Energy

500

Private Equity

Supply of tap water using Solar pumps

30

Central Govt.

Create a farmer Co-operative Society/Company/Group and Provide Private Investment and Transmission system for Solar Energy Generation Projects

250

Private Equity or Agencies

For Solar/Wind Energy based projects with energy storage projects

50

Construction of Solar powered E-vehicle Charging Station

50

Establishment of Solar/Wind Hybrid Projects for Transmission

50

Total

12,930

  • As per the second part of the policy, the state plans to implement over Rs.780 million /annum worth of transmission-free projects. A transmission-free project refers to power projects that are not connected to the grid.
  • These include 100,000 agricultural solar pumps, 52,000 kV of rooftop solar systems, 2,000 solar water supply stations, the electrification of 10,000 rural homes, micro grid projects for 20 homes, 55,000 square feet of solar water/solar cooking systems, and 800 solar cold-storage projects. The details are furnished below:
  • Maharashtra Renewable Energy Policy 2020: Integrated Strategy for Transmission – Free Renewable Projects (Part-2)

Projects

Details

Authorities

Annual Expenditure

Million (Rs.)

Million $

Rooftop or Ground –mounted Hybrid/Off-GRID Solar Projects

52,000 kV

Private Equity, Central Govt, Agencies or Relevant Departments

   

Solar Agriculture Pumps

1,00,000 pumps

     

Solar pumping station for water supply

2000 pumps

Private Entity, Central Govt., Agencies or Relevant Departments

   

Rural- Electrification Program

10,000 homes

 

380

5.19

Micro –GRID Project

20 homes

 

400

5.46

Solar Water Plants and Solar Cooking Systems

55,000 sq.ft.

     

Cold Storage Based on Solar Energy

800 systems

     

Total

780

10.65

Andhra Pradesh

Andhra High Court Interim stay on finalisation of tenders for solar power projects

  • A single-judge Bench of the Andhra Pradesh High Court, comprising Justice M. Ganga Rao, has stayed the finalisation of tenders pertaining to the solar power projects proposed to be developed by the State government for supplying free power to the farm sector till the next hearing on 15 February, 2021.
  • The High Court of Andhra Pradesh has directed the Andhra Pradesh Green Energy Corporation (APGECL) to not enter into any agreements for its tender for 6.4 GW of solar power projects until further notice.
  • The stay order follows an appeal filed by Tata Power Renewable Energy on January 6 for stopping further process on APGECL’s request for selection (RfS) and draft power purchase agreements (PPAs).
  • Tata Power argued that the dispute resolution mechanism provided for in the Requests for Selection (RfS) and the draft Power Purchase Agreements (PPAs) had an effect of defeating the jurisdiction of the AP Electricity Regulatory Commission (APERC) under Section 63 of the Electricity Act.
  • APGECL had floated the tender in early December to set up 6.4 GW of solar projects at ten locations in the state to supply power to agricultural consumers in the state. The state government had planned to install 10 GW to ensure nine hours of daytime free power supply to the agriculture sector on a sustainable basis. The program was proposed in February and approved in June.
  • Selected bidders were expected to install 1,200 MW of solar projects at Kambadur, 600 MW of solar projects each at Chakrayapet, Kambaldinne, Pendlimarri, Rudrasamudram, CS Puram, Uruchintala, Mudigubba and Kolimigundala, and 400 MW at Thondur.
  • Earlier, the National Solar Energy Federation of India asked APGECL to extend the bid submission deadline for its tender for the project by three months.

Karnataka

Safeguard Duty Reimbursement Only for Minimum Contracted Solar Capacity in PPA: KERC

  • Karnataka Electricity Regulatory Commission (KERC) with its Order dated 31 Dec, 2020 has ruled that the imposition of Safeguard Duty (SDG) on imported solar cells and modules constituted a ‘change in law’ event. It said Fortum Solar India was eligible for claiming compensation for the consequent increase in expenditure in implementing their solar projects following safeguard duty imposition.
  • KERC has declined to compensate the company for carrying costs and the cost of additional solar modules procured to optimize the performance of the project.
  • Fortum Solar India had filed petitions with the KERC seeking reimbursement for the additional expenses from the Bangalore Electricity Supply Company, Hubli Electricity Supply Company, Chamundeshwari Electricity Supply Company, and the Mangalore Electricity Supply Company.
  • Fortum Solar India had signed power purchase agreements (PPAs) with all of these distribution companies (DISCOMs) for setting up 250 MW of grid-connected ground-mounted solar projects. It had won the projects in the Karnataka Renewable Energy Development Limited’s tender for 650 MW at the Pavagada Solar Park in Karnataka. The tariff discovered for these projects was Rs. 2.85 /kWh.
  • Shortly after the letter of approval (LoA) was issued, and PPAs were signed, the Ministry of Finance imposed SGD on the import of solar cells and modules from China, Thailand, and Vietnam.
  • Fortum Solar had petitioned KERC for a declaration that the imposition of SGD was a ‘change in law’ event.
  • DISCOMs also countered that Fortum’s claims for reimbursement of the additional expenses could have been avoided if they had imported their modules from countries that do not attract SGD instead of sourcing them from China.
  • After analyzing the submissions, KERC rejected the respondent’s argument that Fortum cannot seek relief under the ‘change in law’ clause because they imported their components from China after the SGD was imposed. It reiterated that the imposition of SGD was indeed a ‘change in law’ event and that the developer could claim relief under this clause of the PPA. It, however, ruled that carrying costs cannot be claimed under the clause.
  • However, KERC agreed with the contention of the DISCOMs that the developer had imported more modules than was necessary for the generation capacity.
  • “The petitioners cannot opt to achieve higher Capacity Utilization Factor (CUF) merely by increasing solar modules, and the same is not a prudent practice. Instead, the petitioners should have opted for a sophisticated module that generates higher energy with lower degradation. Hence, while executing PPA, respondents herein obliged to purchase the energy of minimum capacity from contracted capacity and not obliged to reimburse the safeguard duty on excess modules installed in their solar power project,”
  • KERC declared that it could not allow an SGD reimbursement on the additional quantity of solar modules. The regulator directed the parties to verify the amount payable to Fortum after examining the relevant documents within two months. It directed the DISCOMs to pay this amount to the developer, spread evenly over the remaining period of the PPA and through an appropriate increase in the tariff. It also directed the petitioner and the respondents to submit a supplementary PPA for approval.

West Bengal

West Bengal allows net metering for individual households and Mandates Gross Metering for Rooftop Solar Systems Above 5 kW

  • West Bengal Electricity Regulatory Commission (WBERC) has issued amendments to the Cogeneration and Electricity Generation from Renewable Sources Regulations, 2013 on 21 December, 2020.
  • In September last year, WBERC had published draft amendments to the regulations and invited feedback from stakeholders.
  • According to an amendment, an eligible consumer means a consumer who has installed or proposes to install a rooftop system or any other mounting structure of 1 kW capacity or above to meet his requirements or supply to the DISCOM on a net metering basis.
  • Eligible consumers with sanctioned load demand up to 5 kW are allowed to set up rooftop solar systems with a net metering facility. Consumers (except agriculture consumers) with contract demand above 5 kW are to set up the system under the net billing (gross metering) arrangement.
  • Further, the solar generating systems, which are already connected under the net-metering arrangement, should continue with the existing accounting and settlement mechanism. There was no mention of consumers below the sanctioned demand of less than 5 kW in the earlier regulations. The clause was valid for a total installed capacity greater than 5 kW.
  • All existing rooftop solar systems under the net metering arrangement will continue with the existing accounting. But in case an additional capacity is installed by the same consumer, their eligibility for net metering or gross metering will be considered afresh. Net metering is allowed for all agriculture consumers.
  • Any excess energy injected from the rooftop solar system being more than 90% of the consumer’s energy consumption in each billing period should be carried over the next billing period within that year. Also, slab tariffs will be applicable for the net energy supplied by the licensee in a billing period if the power provided is more than the injected energy by the rooftop solar system.
  • At the end of the year, if the total energy supplied by the licensee to the consumer for that year is less than the energy injected by the rooftop solar system of that consumer, the licensee will not pay any charge to the consumer for that net energy above 90% of the consumption. The same will be treated as an unwanted injection of electricity.
  • In this amendment, the renewable purchase obligation (RPO) target for the years 2020-21 to 2022-23 has been mentioned below:

Financial Year

Renewable Purchase Obligation of Tata Power Consumption

Solar

Non-Solar

Total

2020-21

3%

9%

12%

2021-22

4.5%

10%

14.5%

2022-23

6%

11%

17%

  • According to the amendments, the solar RPO compliance should be 85%. It can be met through non-solar sources beyond the specified solar RPO. Similarly, non-solar RPO compliance should be 85%, with the shortfall made up by excess solar energy.

Himachal Pradesh

Himachal Pradesh Sets Levelized Tariffs for Solar Projects Up to 5 MW for FY 2020-21

  • Himachal Pradesh Electricity Regulatory Commission (HPERC) has issued generic levelized tariffs for solar projects (not exceeding 5 MW) for the financial year (FY) 2020-21 on 15 January, 2021.
  • For determination of Tariff, HPERC considered the normative capacity utilization factor (CUF) as 21% in line with the Central Electricity Regulatory Commission’s (CERC) norms. The auxiliary consumption of 0.75% was considered a separate component under the CERC norms, which was not the case in previous solar tariff orders.
  • HPERC retained the useful life of solar projects at 25 years as per the renewable energy tariff regulations 2017. HPERC said that the generic levelized tariffs were being determined in its latest order only for procurement of power by the distribution company (DISCOM) from solar projects with capacities not exceeding 5 MW.
  • HPERC stated that CERC had neither specified any benchmark for determining the normative capital cost for the solar PV projects nor determined generic levelized tariffs in their tariff regulations, 2020. Accordingly, the Commission decided to evolve its technology-specific parameters after taking into account the available inputs.
  • Earlier last year, HPERC set the capital cost of the solar projects of capacity above 1 MW and up to 5 MW at Rs.38.63 million /MW for the last six months of the financial year FY 2019-20. The capital cost considered for the FY 2021-21 is Rs.37.905 million /MW.
  • The operation and maintenance (O&M) charges for the FY 2020-21 was set at Rs. 874,000 /MW, and these would be escalated at the rate of 3.84% per annum over the tariff period. In FY 2019-20, it was taken as Rs. 827,000 /MW escalated at the rate of 5.72% per year over the tariff period.
  • HPERC approved the debt-equity ratio of 70:30 and the return on equity at 14%.
  • The depreciation rate for the first 15 years was considered 4.67%, and the rate of depreciation from the 16th year onwards would be spread over the balance of the useful life.
  • For solar projects set up in areas other than industrial and urban areas, HPERC has set the tariff at Rs.3.41 /kWh which is 14% lower than the previous year’s Rs. 3.98 /kWh for solar projects of capacity up to 1 MW.
  • For solar projects of capacity up to 1 MW set up in areas other than industrial and urban areas, the tariff is Rs.3.48 /kWh as compared to Rs.4.06 /kWh last year. The generic levellised tariffs for Solar PV power projects for FY 2020-21 shall be as under:

Sr. No.

Capacity

Generic levellised tariff (Rs. Per kWh)

1

Projects to be set up in other than industrial areas and urban areas

(a)

Upto 1.00 MW capacity

3.41

(b)

Above 1.00 MW to 5.00 MW capacity

3.37

2

Projects to be set up in industrial areas and urban areas

(a)

Upto 1.00 MW capacity

3.48

(b)

Above 1.00 MW to 5.00 MW capacity

3.44

These tariffs will be governed by the following provisions:

  • In cases where the joint petition for approval of power purchase agreement (PPA) has been submitted to the Commission on or after 01 April, 2020, but no later than 31 March, 2021, the tariffs will be applicable for the capacity commissioned on or before 31 March, 2022.
  • In cases where the joint petition for PPA approval was submitted to the Commission on or before 31 March, 2019, the tariffs will be applicable for the capacity commissioned during the FY 2020-21.
  • These tariffs will not be applicable when the distribution licensee procures power through the Solar Energy Corporation of India (SECI) or competitive bidding. They will also not be applicable if the consumers install the solar projects within their premises (rooftop or ground-mounted) under the net metering program.

Budget Highlight 2021-22

  • The Union Budget for 2021-22 provided INR2,606 Crore for solar power sector, a 66.4% increase over previous year allocation.
  • Budget also provided Central Financial Assistance (CFA) for capacity addition of 7,500 MW of solar power in 2021-22.
  • In view of ameliorating the viability of distribution companies (discoms), a revamped power distribution sector scheme would be launched with a financial outlay of more than Rs. 3 trillion crores over a 5-year period. The scheme would be targeted at infrastructure creation including pre-paid smart metering and feeder separation, upgradation of systems, etc.
  • To induce greater market competition, it was announced that a framework would be put in place which would enable electricity consumers with the power to select an alternative out of >=2 discoms.
  • In succession to PM Narendra Modi’s announcement in November 2020 related to launch of comprehensive National Hydrogen Energy Mission, it is now proposed to launch a Hydrogen Energy Mission in 2021-22 for generating hydrogen from green power sources. 
  • An additional capital infusion of Rs. 1,000 crores to Solar Energy Corporation of India (SECI) and Rs. 1,500 crores to Indian Renewable Energy Development Agency (IREDA) was also announced.
  • In a bid to boost the indigenous solar manufacturing capacity, a phased manufacturing plan (PMP) for solar cells & modules will be notified. Additionally, as an immediate incentive (w.e.f 2nd February 2021), customs duty on solar inverters is raised from 5% to 20% and that for solar lanterns or lamps from 5% to 15%. 
  • Because of increase in duties for solar inverters, project costs will increase for rooftop/ small scale solar market. Utility scale solar projects where auctions are already completed will get a pass through under ‘change in law’ condition.
  • Customs duty at 2.5% would be applicable for inputs, parts and sub-parts (other than Printed Circuit Board Assembly and Li-ion cell) for production of Li-ion battery and battery pack w.e.f. 1st April 2021.
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