Maharashtra Issues Guidelines for Rooftop Solar Installations at Sugar Factories

The solar project capacity is not restricted


The Maharashtra Electricity Regulatory Commission (MERC) has issued directives regarding the installation of rooftop solar systems by sugar factories that have Energy/Power Purchase Agreements (EPA/PPA) with the Maharashtra State Electricity Distribution Company (MSEDCL) for their bagasse-based cogeneration projects.

The guidelines, aimed at implementing the MERC order dated July 21, 2022, stipulate that sugar factories with EPA/PPA agreements with MSEDCL for cogeneration projects based on bagasse must submit applications to the Chief Engineer (Renewable Energy) to install grid-connected rooftop solar systems.

Following approval from the renewable energy section, these sugar factories must apply online through MSEDCL’s ‘Solar Rooftop Portal’ to install the systems.

MSEDCL’s field offices will handle the application process for sugar factories in accordance with net metering regulations.

Each renewable energy source within the sugar factory premises, including cogeneration and solar projects, must be equipped with a generation meter featuring automated meter reading (AMR) capabilities as per Central Electricity Authority (CEA) specifications.

The designated Superintendent Engineer will provide specifications for the metering arrangement, including the generator meter for each renewable energy source, and verify the evacuation metering.

The solar generation meter will be installed at the same voltage level as the cogeneration meter voltage level.

Before installation, the generation meters will be tested at MSEDCL testing labs.

The provisions outlined in MERC regulations, including the Grid Interactive Rooftop Renewable Energy Generating Systems-2019 and the Electricity Supply Code and Standards of Performance for Distribution Licensees, including Power Quality-2021,will be applicable.

Upon completion of the solar project, the sugar factory must apply for synchronization with the Chief Engineer (Renewable Energy). The sugar factory operates in two modes: operating, when there is generation from the bagasse project, and non-operating, also during bagasse project generation.

For both modes, the sugar factory must provide self-certification indicating the exact date its cogeneration unit will shut down and restart. This certificate must be uploaded online on the NCE portal, and MSEDCL will issue online approval.

After commissioning, the solar project should be treated as a hybrid project during the operating period of the sugar factory and under a “net metering” or “net-billing arrangement” during the non-operating phase.

An amendment agreement between the sugar factory and MSEDCL is necessary to incorporate the capacity of the solar project to be commissioned and its commercial arrangement into the existing EPA/PPA.

Commercial Arrangement for Operating Period

The existing EPA already specifies the tariff for electricity generated from the bagasse-based cogeneration project.

The recent lowest tariff discovered by MSEDCL for a similar-sized solar project [under Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM KUSUM) or Mukhyamantri Saur Krushi Vahini Yojana (MSKVY)] will be considered as the tariff for the solar project to be commissioned by the sugar factory.

A clause for computing the weighted average tariff on a monthly basis for the operating period will be included in the amendment agreement.

Based on the actual generation from each renewable energy source, the weighted average tariff for that month will be computed, and the energy purchased during that month will be paid at such a weighted average tariff.

Throughout the operating period, the sugar factory will continue to be billed at the HT Industrial tariff.

Commercial Arrangement for Non-Operating Period

During the non-operating period, only solar electricity generation is available.

Depending on the installed capacity of the solar project, such a facility needs to be treated under a ‘net-metering’ or ‘net billing’ arrangement. The commencement date of the non-operative period will be based on certification provided by the sugar factory.

The commercial mechanism for ‘net-metering’ or ‘net-billing’ arrangement, as stipulated in the MERC (Grid Interactive Rooftop Renewable Energy Generating Systems) Regulations 2019, will apply during the non-operating period.

Grid support charges of ₹0.72 (~$0.009)/kWh, determined in the multi-year tariff order dated March 30, 2020, will apply to the generated energy under the net-metering arrangement.

Unutilized banked solar energy under the net-metering arrangement at the end of the non-operating period cannot be used during the operating period and will be settled at the end of the financial year.

If the start date of the operating period falls in the middle of the month, the whole month is to be considered the operating period, and the billing is to be done as per the HT industrial tariff.

MSEDCL recently has prepared plans to install 3 million rooftop solar systems on houses in the state under the Pradhan Mantri Surya Ghar – Muft Bijli Yojana.

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