Karnataka Mini-Hydro Projects Can Carry Forward Banked Energy for 2 Months

No such facility provided to other renewable energy projects

July 3, 2020


The Karnataka Electricity Regulatory Commission (KERC) has approved a request to carry forward the banked energy from mini-hydropower generators as of May 31, 2020, to July 31, 2020.

Any banked energy which remains unutilized as on July 31, 2020, will be supplied to the electricity supply companies (ESCOMs) at no cost. It further said that such a facility would not be provided to renewable projects other than mini-hydro projects. The Commission further noted that to carry forward the banked energy, the hydro generators should have executed the wheeling and banking agreement.

Earlier, the Ministry of New and Renewable Energy (MNRE) had issued an advisory for the states of Andhra Pradesh, Karnataka, and Tamil Nadu that they may consider permitting roll-over of banked electricity for the financial year (FY) 2019-20 and FY 2020-21 to FY 2021-22. The advisory was valid for renewable projects under the captive and third-party sale.

Citing the above advisory, several generators approached the Commission asking for its permission to carry forward their banked energy. Later, the Government of Karnataka, after consultation with the Karnataka Power Transmission Corporation Limited (KPTCL) and ESCOMs, requested the Commission to extend the banking period for two months from the date of the opening of the lockdown.

The Commission noted that concerning the renewable energy certificate (REC)-based renewable projects, the banking is done on a monthly basis, and the banked power cannot be carried forward. Considering the case of non-REC based renewable projects, the Commission stated that there is a provision for annual banking, which starts on April 01 of a calendar year and ends on March 31 of the following calendar year. The Commission further noted that as the lockdown started from March 25, 2020, the projects were affected for only seven days, and the impact was very marginal, and there was no need for the roll-over of banked energy.

Now, for non-REC mini-hydro projects, the year starts on June 01 of the calendar year and ends on May 31 of the following year. The Commission said that since these projects were affected by the COVID-19 pandemic and the subsequent lockdown for about two months, the roll-over of banked energy will be allowed for two months ending on July 31, 2020. The Commission further noted that any banked energy that remains unutilized at the end of two months would be supplied to the ESCOMs for free.

The Commission further stated that as per the standard agreement, PTCL and ESCOMs are not obligated to bank and wheel energy in case of force majeure events. If normalcy is not restored within thirty days, the agreement will be temporarily suspended. Further, the KPTCL and ESCOMs will not be liable to pay any damage or compensation to the generating company. However, considering the COVID-19 pandemic as a special case, the Commission allowed the mini-hydro generators to carry forward the banked energy for two months.

Meanwhile, recently, the Government of Karnataka held a meeting to discuss the banking and wheeling charges for grid-connected renewable projects in the state. In the meeting, the government decided that for grid-connected captive solar projects, the consumer will be required to enter into an agreement for the wheeling and banking charges.