MNRE Orders Timely Payment and ‘Must-Run’ Status to Renewable Stations During Lockdown

The Ministry asks DISCOMs to pay renewable energy generators regularly


The Ministry of New and Renewable Energy (MNRE) has issued a clarification regarding the payment to renewable energy generating stations during the moratorium provided to distribution companies (DISCOMs) by the Ministry of Power (MoP).

In the clarification notice, the MNRE has granted a ‘must-run’ status to renewable energy generating stations and this status will remain unchanged throughout the lockdown period.

The Ministry has also said that since the DISCOMs have already been given sufficient relief and the electricity from renewable generating stations comprises only a minor portion of the total electricity generation in the country, the payments to these renewable generators should be made regularly.

In the wake of the deadly coronavirus (COVID-19) outbreak, the Government of India called for a 21-day nationwide lockdown starting from March 25, 2020. Since then, the government has announced several changes and deviations in the existing policies, including the ones related to renewable energy.

Given the pandemic, the Ministry of Power recently issued instructions providing for a moratorium period to DISCOMs for making payments to electricity generating companies.  Last week, the Ministry of Power directed the Central Electricity Regulatory Commission (CERC) to provide a moratorium of three months to DISCOMs to make payments to the generating companies and transmission licensees and not levy any penalties for late payments. The Ministry had also requested the state governments to issue similar directions to state electricity regulatory commissions (SERCs).

Following the ministry’s announcement of providing a moratorium period to the DISCOMs, several representatives from the renewable energy industry expressed their disappointment and alleged that certain state DISCOMs, citing the MoP’s order, have started to curtail the renewable power in some states partially while others termed the prevailing situation as force majeure condition.

For instance, Punjab State Power Corporation Limited (PSPCL) has issued‘force majeure’ notice stating that it has been forced to curtail power purchase and generation due to the ongoing nationwide lockdown. In an email notice, the state distribution company (DISCOM) informed Prayatna Developers Private Limited, a solar power special purpose vehicle (SPV) of Adani Power Limited, that due to a load crash, it is unable to procure power because of the force majeure event (COVID-19 outbreak). It stated that this notice, effective immediately, would hold for as long as the pandemic lasts. The PSPCL added that any power injected into its system would be at the cost and risk of the developer.

Meanwhile, the Solar Power Developers Association (SPDA) and the Indian Renewable Energy Alliance (IREA) have written  letters to the Government of India requesting necessary relief for renewable energy generators in the wake of the Coronavirus pandemic to ensure that the industry continues to generate power during the period.

Coronavirus pandemic is proving to be the solar industry’s biggest challenge this year, and the repercussions are being felt across industries all over the globe. Track the latest developments and initiatives taken by the government to fight the economic repercussions of the pandemic in the renewable industry here.

Anjana is a news editor at Mercom India. Before joining Mercom, she held roles of senior editor, district correspondent, and sub-editor for The Times of India, Biospectrum and The Sunday Guardian. Before that, she worked at the Deccan Herald and the Asianlite as chief sub-editor and news editor. She has also contributed to The Quint, Hindustan Times, The New Indian Express, Reader’s Digest (UK edition), IndiaSe (Singapore-based magazine) and Asiaville. Anjana holds a Master’s degree in Geography from North Bengal University, and a diploma in mass communication and journalism from Guru Ghasidas University, Bhopal.