The Meghalaya State Electricity Regulatory Commission (MSERC) has issued draft regulations to govern grid-interactive Distributed Renewable Energy Systems (DRES) in the state.

Stakeholders can submit their comments by March 13, 2026.

The draft Meghalaya State Electricity Regulatory Commission (Grid Interactive Distributed Renewable Energy Sources) Regulations, 2026, defines DRES as renewable energy systems with a capacity not exceeding 10 MW and connected to the distribution network at 33 kV or below.

The regulations will apply to systems installed within the distribution licensee’s (DISCOM) area of supply.

Ownership Model and Eligibility Conditions

The framework allows consumers either to own the DRES or to install it through a renewable energy service company (RESCO) under mutual commercial arrangements. The draft specifies that the RESCO will enter into a direct agreement with the consumer regarding payment, and there will be no tripartite agreement among the RESCO, the consumer, and the DISCOM. Any dispute arising between the consumer and the RESCO must be settled mutually, and the DISCOM cannot disconnect the supply due to such disputes.

Consumers with pending arrears with the DISCOM will not be eligible to install DRES unless they deposit the disputed amount in accordance with Section 56 of the Electricity Act, 2003.

Open access consumers are also permitted to establish DRES on their premises. In such cases, settlement priority is to be given first to open access transactions, followed by banked energy from on-site DRES or as determined by the Commission.

Net Metering

Under net metering, eligibility will be restricted to domestic and agricultural consumers, group housing, charitable institutions, and government buildings, including schools and buildings owned by local authorities.

The minimum project capacity is 1 kW, and the maximum capacity cannot exceed the sanctioned load or contract demand, or 500 kW, whichever is lower. Systems with a capacity of over 10 kW must be equipped with a hybrid inverter and a battery energy storage system with a minimum storage capacity of 20% of the project’s energy generation potential.

Surplus energy injected into the grid during a billing cycle can be carried forward to subsequent billing cycles within the same settlement period, defined as April to March.

At the end of the settlement period, any unadjusted surplus will be settled at 75% of the weighted average tariff of solar projects with a minimum capacity of  5 MW discovered through competitive bidding in the previous financial year, or at a reference rate determined by the Commission.

The carry-forward balance will be reset to zero at the beginning of each settlement period.

Consumers will continue to pay fixed charges, demand charges, and other applicable levies irrespective of surplus generation.

Net Billing

Net billing will be available to consumers across all categories. The minimum capacity under this mechanism is 1 kW, and the maximum capacity is capped at the sanctioned load or contract demand, or 500 kW, whichever is lower.

Under net billing, imported energy will be billed at the applicable retail tariff, while exported renewable energy will be credited at 100% of the weighted average tariff of solar projects of at least 5 MW discovered through competitive bidding in the previous financial year, or at the Commission-determined reference rate.

If the cumulative credit exceeds the debit during a billing cycle, the net credit will be carried forward. At the end of the settlement period, any remaining net credit must be paid by the DISCOM to the consumer.

Gross Metering

Gross metering will be permitted for all consumer categories, including installations outside consumer premises with separate connectivity. The maximum capacity under gross metering is 10 MW.

The DISCOM will purchase the entire energy generated at 100% of the weighted average tariff discovered for solar projects of at least 5 MW in the previous financial year, or at the reference rate determined by the Commission. Electricity consumed by the consumer will be billed separately at the applicable retail tariff.

Where the proposed DRES capacity exceeds the sanctioned load or is installed at a separate premise, the capital expenditure for service line-cum-development and network augmentation must be borne by the consumer.

Group Net Metering

Group net metering will be restricted to the same consumer categories eligible under net metering. Surplus energy from a DRES can be adjusted against multiple service connections of the same name and category within the licensee’s area of supply.

The minimum capacity under group net metering is 5 kW, and the maximum capacity cannot exceed the combined sanctioned load or contract demand of all participating service connections.

The service connection where the DRES is located must consume at least 20% of the total energy generated. Any portion of this 20% not consumed at the source connection will be treated as lapsed energy.

Unadjusted surplus at the end of the financial year will be purchased by the licensee at 75% of the weighted average tariff of solar projects of 5 MW and above, or at the reference rate. Cumulative balances will be reset at the beginning of the settlement period.

Virtual Net Metering

Virtual net metering allows two or more consumers of the same category to set up DRES and apportion generation based on an agreed ratio submitted to the DISCOM.

The minimum capacity is 5 kW, and the maximum is limited to the combined sanctioned load or contract demand of participating consumers. Surplus energy can be carried forward within the settlement period. Unadjusted surplus at the end of the financial year will be settled at 75% of the weighted average tariff of solar projects of at least 5 MW, or at the reference rate, and balances will be reset at the start of the new settlement period.

Behind-the-Meter Installations

Behind-the-meter installations will be permitted for all consumer categories for self-consumption without the sale of electricity to the DISCOM.

Prior intimation to the licensee is mandatory. If a consumer installs DRES without prior intimation, they must inform the licensee within three months. Failure to do so will attract a one-time penalty of ₹1,000 (~$11)/kW of the installed capacity, or as determined by the Commission.

Such systems must install reverse-power-flow relays to prevent injection into the grid. Any inadvertent injection will neither be paid for nor settled and may attract penalties under applicable regulations.

Applicability of Charges and Grid Support

DRES installed on consumer premises under net metering, net billing, gross metering, and behind-the-meter arrangements will be exempt from banking charges, wheeling charges, cross-subsidy surcharge, and additional surcharge.

Under group and virtual net metering, no charges will apply if the DRES and participating connections are on the same distribution transformer or feeder. If not, applicable open access charges and losses will apply in accordance with the Commission’s Green Energy Open Access or Open Access Regulations, except for cross-subsidy surcharge and additional surcharge in specified cases.

The Commission can introduce grid support charges for virtual net metering, group net metering, and behind-the-meter arrangements to cover balancing, banking, and wheeling costs after adjusting renewable purchase obligation (RPO) benefits and avoided distribution losses. Such charges will not apply to net metering, net billing, and gross metering consumers.

Hosting Capacity Cap

The regulations provide that the cumulative DRES capacity interconnected to a distribution transformer cannot exceed 80% of its rated capacity and 100% of feeder capacity.

Metering Infrastructure and Implementation

All meters must comply with the Central Electricity Authority’s metering regulations and be equipped with advanced metering infrastructure capabilities. DISCOMs must modify its metering and billing infrastructure within three months of notification.

DISCOMs must also provide detailed guidelines within 60 days, create or update a web-based application portal, publish standardized procedures, list applicable charges and empaneled service providers, and display feeder-wise hosting and installed DRES capacity.

Subsidies and Reference Rate

Eligible consumers will be entitled to subsidies under the Ministry of New and Renewable Energy and state government notifications. The Commission can estimate DRES capacity-wise reference rates after considering applicable subsidies.

Renewable Purchase Obligation Compliance

DISCOMs will account for the quantum of distributed renewable energy generation recorded by the generation meter toward their RPO.

If the DRES is set up by designated consumers, open access consumers, or captive users, the entire renewable energy generated will count toward their respective RPO compliance. If the licensee pays for any unadjusted renewable power injected by such systems at the end of the settlement period, that quantum will be considered toward its RPO.

Once notified, the draft regulations will repeal the Meghalaya State Electricity Regulatory Commission (Rooftop Solar Grid Interactive Systems based on Net Metering) Regulations, 2015, along with subsequent amendments and procedures.

Last December, MSERC issued draft rules laying down the terms and conditions for tariff determination for power generated from renewable energy sources.

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