Andhra Pradesh Regulator Rolls Out Green Energy Open Access Rules 2024

The Commission issued the preliminary draft in October last year

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The Andhra Pradesh Electricity Regulatory Commission (APERC) has adopted the Green Energy Open Access, Charges, and Banking Regulations, 2024.

The regulations apply to granting open access for electricity generated from renewable energy sources for utilization within the state involving Intra-State Transmission Systems (lnSTS) and/or distribution systems of licensed entities.

In October, APERC issued the preliminary draft of the regulations and invited stakeholders’ opinions.

The revisions to the final regulations are as follows:

Changes in Definitions

Following a review of the suggestions received, the Commission revised the definitions as follows:

‘Banking’ refers to a facility wherein any unused energy (either not consumed by the consumer or generated more than the scheduled amount by the generator) from any Green Energy Sources during a billing month is stored separately. Such accrued energy will be managed per the conditions outlined in these regulations.

‘Entity’ refers to any consumer with a contracted demand or sanctioned load of 100kW or more, either through a single connection or via multiple connections totaling 100kW or more within the same electricity division of a distribution licensee, excluding captive consumers, provided that captive consumers are exempt from load limitations; and provided further that the entity may lack a supply agreement with the DISCOMs.

‘Green Energy’ has also been changed to denote electrical energy from renewable sources.

For ‘Renewable Sources of Energy,’ the Commission said the definition must be understood alongside the definition of Green Energy. Storage is already included in the definition of Green Energy. However, considering the suggestion, the Commission amended the definition as follows:

‘Renewable Sources of Energy’ encompasses renewable energy sources such as small hydro, wind, solar, biomass, biofuel, cogeneration (including bagasse-based cogeneration), municipal solid waste, RE Hybrid, hydro, storage (if the storage utilizes renewable energy), and other sources or mechanisms recognized and approved by the Government of India or State Government.

‘Rules’ will refer to the Electricity (Promoting Renewable Energy Through Green Energy Open Access) Rules, 2022.

Criteria for allowing GEOA

There should not be any design or system constraint for Open Access Capacity permission within the Contracted Maximum Demand with the DISCOMs.

The Commission accepted the suggestion and revised the draft as follows:

  • Long-term GEOA will be permitted per the transmission planning criteria and distribution planning code outlined in the state grid code.
  • Short-Term/Medium-Term open access will be permitted if the request can be accommodated by utilizing:

Categorization of Open Access

The open-access consumers will be categorized into the following groups based on the duration of their utilization of the intra-state transmission and/or distribution system:

  • Long-term Open Access consumers – individuals utilizing or intending to utilize open access for a period equal to or exceeding five years
  • Medium-term Open Access consumers – individuals utilizing or intending to utilize open access for a period exceeding one year but less than five years
  • Short-term Open Access consumers – individuals utilizing or intending to utilize open access for up to one year

Provided that short-term open access consumers will be eligible for and can reapply for fresh reservations after the expiration of their term, such eligibility will be prioritized based on the date of application.

Eligibility Criteria for Green Energy Open Access

Any consumer or generator can utilize green energy open access for third-party sale or captive use. Power purchase agreements cannot be altered with the current regulations by granting deemed open access to generators with outstanding dues for more than two months of billing from the distribution/transmission licensee.

After reviewing other suggestions, the Commission modified the clause as follows:

Subject to the provisions of this regulation and system availability, all entities are eligible to procure power from any green energy generator through GEOA for third-party sale or captive use.

Entities or generators declared insolvent or bankrupt, or with undisputed outstanding dues exceeding two months of billing from the distribution/transmission licensee, or facing cases of undisputed unauthorized use of electricity/theft of electricity pending against them at the time of application are not eligible for open access.

Any entity/generator revived through the National Company Law Tribunal (NCLT) resolution process or any other legal process will also be eligible for open access.

Nodal agency and procedure for Granting Green Energy Open Access

Applications received directly or through the central nodal agency by the state nodal agency (SNA) will be processed according to the procedures and formats devised by SNAs. SNAs will develop detailed procedures and timelines for green energy open access and submit them to the Commission within 30 days of the gazette notification date.

The procedures and timelines should be developed per the central agency and GEOA rules.

However, until the Commission finalizes the specific procedures and timelines for GEOA, the existing procedures under the Open Access Regulation 2005 of APERC will be followed in granting GEOA.

The timelines in the procedures notified by the central agency and the GEOA rules will supersede those specified in Regulation 2005 of APERC. The procedure specified for Long-Term Open Access may also be followed for Medium-Term Open Access.

Connectivity and Energy Settlements

Connectivity for all new green energy generators will be granted per the APERC Regulation on Power Evacuation from Captive Generation, Cogeneration, and RE Source Power Plants (Regulation 3 of 2017).

The energy settlements of all intra-state GEOA generators/consumers will be conducted as per Regulation 2 of 2006 and its subsequent amendments.

All energy from GEOA generators will be settled in 15-minute block-wise intervals based on the day-ahead schedule. In cases where capacities are small and implementing the 15-minute block-wise schedule is challenging, the actual generation from the green energy generator during the month will be considered scheduled energy.

For settlement purposes regarding scheduled/QA consumers supplied by these OA GE generators, the actual generation during the month will be apportioned for each time block of the month if Time of Day (ToD) billing is applicable for consumers, with deviations reckoned accordingly.

If ToD billing is not applicable, the actual generation from the green energy generator during the month will be deemed scheduled energy and accounted for in settlement with such consumers. However, banking will be conducted as per this regulation in all cases.

The energy settlements of intra-state RE generators for interstate transactions will be conducted according to CERC Regulations. Deviations from intra-state wind and solar generators’ schedules for interstate transactions will be settled in line with CERC DSM Regulations, 2022.

Treatment for Existing Entities

The Commission will consider the suggestion of allowing additional Open Access capacity for existing OA Green Energy users under the present regulation.

After the completion of the term of the existing agreement, any renewal will be based on the parties’ mutual agreement. Accordingly, the draft is modified as follows:

The existing consumers/generators will continue to utilize open access per the terms specified in their existing agreements or government policies for the duration outlined in those agreements or policies to the extent they are not inconsistent with the Act.

GEOA for the period following the expiration of the existing agreement concerning such consumer/generator will be governed by the provisions of these regulations.

Furthermore, the existing OA consumers may procure additional power through GEOA under the present regulation.

Levy of Charges

Transmission charges: GEOA consumers must pay transmission charges as applicable and determined by the Commission in Multi-Year Tariff Orders for the relevant period, by APERC (Terms and Conditions for Determination of Transmission Tariff) Regulation, 2005, and its subsequent amendments.

Wheeling charges: GEOA consumers must pay wheeling charges as applicable and determined by the Commission in Multi-Year Tariff Orders for the relevant period, per APERC (Determination of Tariff for Wheeling and Retail Sale of Electricity) Regulation, 2005, and its subsequent amendments.

Cross-subsidy surcharge: GEOA consumers must pay the cross-subsidy surcharge as applicable and determined by the Commission in the Retail Supply Tariff Order.

Standby charges: The Standby Charges will be will120% of the standard tariff (for both demand and energy) of the consumer category without imposing any penalty for exceeding the Contracted Maximum Demand in the absence of notice from the parties concerned. The Maximum Demand charges will be based on the Recorded Maximum Demand registered in the meter for exceeding the maximum demand, and the energy charges will correspond to the open access demand.

If the DISCOMs receive notice from the parties concerned regarding the standby arrangement, and if such standby period extends beyond 72 hours from the time of notice, the Standby Charges will equate to 120% of the normal tariff on energy or the maximum tariff of energy purchased from the exchanges/market (during the standby period), whichever is higher. However, charges within 72 hours from the notice will be limited to only 120% of the average tariff on energy.

The Load Curtailment is not applicable if the GEOA consumers do not opt for a standby arrangement with the DISCOMs. In cases where a standby arrangement is requested, the LC for three days of the open access consumption may be obtained.

Reactive Energy Charges: Generators utilizing Green Energy Open Access must pay for reactive energy as per the provisions outlined in the State Grid Code notified by the Commission. When the Commission has not specified rates in the State Grid Code, the rates specified in CERC Regulations/Orders will be applicable.

Application fees are non-refundable. Following the examination of APTRANSCO’s submissions, the Commission has decided to modify the draft as follows:

The processing fee for Green Energy Open Access under Long-term, Medium-term, and Short-term arrangements will be ₹150,000 (~$1,796), ₹100,000 (~$1,197), and ₹50,000 (~$598), respectively.

Banking

A banking facility will be provided to consumers utilizing GEOA, subject to the following conditions:

1) Banking will operate on a monthly billing cycle basis, with each calendar month considered one billing cycle. Banked energy must be utilized within the same billing cycle. At the end of the billing cycle, unused energy will be compensated at 75% of the last discovered SECI tender rate for the respective renewable energy source, as notified annually by APERC. The distribution licensee will benefit from the corresponding Renewable Purchase Obligation (RPO) for the unutilized banked energy.

2) Banking charges will be 8% of the energy banked at the consumer’s end. If Transmission/Wheeling Charges and Losses have already been levied on the total quantum to determine transmitted/wheeled energy, no further wheeling charges and losses will be applied to banked energy during drawl.

3) Green Energy Open Access consumers may bank up to 30% of their total monthly electricity consumption from the green energy source in a banking cycle.

4) Banking and drawal are permitted throughout the billing cycle. Energy banked during peak Time of Day (ToD) slots may be drawn during peak and off-peak ToD slots. Conversely, energy banked during off-peak ToD slots may only be drawn during off-peak ToD slots. Drawal of banked energy during peak load hours, as specified in the ToD approved by the Commission in the Retail Supply Tariff Orders, is not permitted if R&C measures are in force.

5) Settlement of open-access energy at the consumer end will follow this priority order:

  • Open Access Power through Exchange / Bilateral transactions
  • Captive Power/Third party (Non-RE)
  • RE generation after deduction of losses
  • Banked Energy
  • DISCOM’s power

Settlement of open-access energy for the generator will follow this priority order:

  • Open Access Power through Exchange / Bilateral transactions
  • Open Access Power through intrastate consumer transactions

6) The State Load Dispatch Center (SLDC) will manage energy accounts for all banking transactions. Model illustrations of energy settlements, banking methodology, banking charges, and banking settlements for different scenarios will be made available on the SLDC’s website for various stakeholders to understand easily.

Green Certificates

The distribution licensee will annually provide a green certificate to consumers who have purchased green energy from them, in accordance with the APERC Renewable Power Purchase Obligation (Compliance by the purchase of Renewable Energy/Renewable Energy Certificates) Regulation, 2022, and its subsequent amendments. Obligated entities may be issued Renewable Energy Certificates (RECs) if their purchases from renewable energy sources other than from the DISCOMs exceed the Renewable Purchase Obligations specified by this Commission, as per the CERC REC Regulations 2022, following the stipulated procedure.

Collection and Disbursement of Charge

The procedure outlined in APERC Regulation 2 of 2005 will be adhered to collect and disburse charges as per this Regulation from/to GEOA consumers.

The Commission adopted the remaining clauses proposed in the draft without alterations where stakeholders have neither submitted comments for modification nor proposed the same.

Mercom earlier reported a revival of industry interest in sourcing solar energy through open access in Andhra Pradesh. Installations surged by 450% quarter-over-quarter to 75.3 MW in the third quarter of 2022.

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