Maharashtra Not to Levy Grid Support Charges on Rooftop Solar

Reduces retail electricity tariffs effective from April 1, 2020

April 1, 2020


The Maharashtra Electricity Regulatory Commission (MERC) has approved the revised retail electricity tariffs for the Maharashtra State Electricity Distribution Company Limited (MSEDCL) for the fourth control period from FY 2020-21 to FY 2024-25, focusing on mitigating the difficulties faced by electricity consumers in the states due to the Coronavirus pandemic.

The revised tariffs are effective from April 1, 2020. The state electricity commission also put a moratorium on the payment of electricity bill fixed charges by industrial and commercial customers for three billing cycles effective from the lockdown date, March 25, 2020.

Important revisions:

The commission approved average tariff reductions of 7% for the financial year 2020-21 and an almost flat tariff for most of the categories or a further reduced tariff for industry up to FY 2024-25. The tariffs for the industrial and commercial sectors were also reduced by 10% to 15%.

Retail electricity tariffs for residential consumers were reduced by 5%. No changes were made to agricultural tariffs, with the current 50% of cross-subsidies continued to be extended for consumers in the category. This, in addition to subsidies from the government, agricultural consumers get an over 85% subsidized tariff. Net tariffs remained unchanged.

Throwing light on the category of consumers, distribution company said that the industrial consumers made up for 1% of the consumer mix, contributing to 37% of the sales, and 43% of the revenue. Residential category amounted to 75% of the consumer mix, bringing in 20% of the sales, and 21% of the revenue. Agriculture consumers comprised 16% of the consumer mix, contributing 25% of the sales, and 14% of the revenue.

Electric Vehicles:

For the electric vehicles (EV) segment in the state, the commission has approved concessional, lower than the average cost of supply (ACoS) tariffs for EV charging stations at high tension (HT) and low tension (LT) voltage levels, with an effective variable charge of ₹5.50 (~$0.073)/kWh, and demand charges of ₹70 (~$0.93)/kVA per month.

The revised regulations also stated that EV consumers are eligible for load factor and power factor incentives or penalties, as applicable, besides Time-of-day (ToD) tariffs, further reducing their tariff burdens.

Renewable Energy Sector:

The Commission said it has decided not to levy any grid support charges to rooftop solar installations until the cumulative rooftop photovoltaic (PV) capacity of the state reaches 2 GW. It added that it has decided to take this step to reduce additional tariff burden on non-solar consumers, despite the regulatory mandate to impose grid support charges.

The commission also said that it has approved a banking charge in kind in the form of energy adjustment of 7.5% for HT and 12% for LT of the excess generated energy fed back into the grid.

Also, additional fixed charges on behind the meter rooftop solar is exempted with a focus on registering such installation primarily for grid security.

In support of the Go-Green initiative, the Commission has approved a bill discount of ₹10 ($0.03) per month per bill, if the consumer opts for e-bill.

Previously, Mercom reported that the Maha Solar Sangathan (MSS) raised concerns over the proposed grid support charges (GSC), requested the Maharashtra Electricity Regulatory Commission (MERC) to ask the state DISCOM (MSEDCL) to explain that when the total handling cost of electricity is ₹0.70 (~$0.01)/kWh, why has the DISCOM proposed a hefty grid support charge to the tune of ₹8.66 (~$0.12)/kWh.

Earlier, in a significant development that could have huge implications on the state’s rooftop solar segment, the MSEDCL proposed considerable grid support charges for net metering rooftop solar systems with a capacity of over 10 kW.


Image credit: Sunsenz Solar Kerala