The Odisha Electricity Regulatory Commission (OERC) has proposed a phased increase in renewable consumption obligation (RCO) targets, mandating obligated entities to raise renewable energy consumption from 29.91% in 2024–25 to 43.33% by 2029–30.

The draft “OERC (Renewable Consumption Obligation, Distributed Renewable Energy Sources and Renewable Energy Linked Concepts) Regulations, 2026, specifies a detailed composition of RCO, with a total renewable energy of 29.91% for 2024–25, with year-wise escalation to 33.01% in 2025–26, 35.95% in 2026–27, 38.81% in 2027–28, and 41.36% in 2028–29 before reaching the final target of 43.33% in 2029-30.

Wind obligations will apply to projects commissioned after March 31, 2024, while hydro obligations will apply to pumped-storage and small hydro projects, including those located outside India. Compliance can be achieved through direct consumption of renewable energy, procurement via distribution licensees, or purchase of renewable energy certificates, with monitoring assigned to the state load dispatch center.

The draft also introduces enforcement mechanisms for the renewable consumption obligation and integrates emerging concepts such as peer-to-peer energy trading, virtual power plants, vehicle-to-grid systems, and agrivoltaics into the state’s electricity ecosystem.

DRES Norms and Storage Mandates

The draft also aims to establish a comprehensive framework for Distributed Renewable Energy Systems (DRES). It defines DRES as renewable installations with up to 10 MW of capacity connected at 33 kV or below and introduces mandatory storage requirements for systems of 5 kW or above.

Storage requirements are specified in a graded manner, beginning with a minimum of 1 kWh for systems above 5 kW up to 10 kW, increasing to 2 kWh for systems above 10 kW up to 30 kW, 6 kWh for systems above 30 kW up to 100 kW, 20 kWh for systems above 100 kW up to 500 kW.

For systems above 500 kW up to 1 MW, a minimum of 100 kWh is required; 400 kWh for systems above 1 MW up to 3 MW; 1200 kWh for systems above 3 MW up to 7 MW; and 2800 kWh for systems above 7 MW up to 10 MW.

The regulation also introduces an energy storage obligation requiring that at least 85% of stored energy must originate from renewable sources for compliance.

Metering Rules

Six metering mechanisms are permitted, including net metering, net billing, gross metering, group net metering, virtual net metering, and behind-the-meter arrangements.

For net metering and net billing, capacity is capped at 1-500 kW or the sanctioned load, whichever is lower, while gross metering allows installations from 1 kW to 10 MW. Group and virtual net metering are permitted for capacities ranging from 5 kW to 500 kW or the combined load.

The draft also prescribes technical limits, stating that the total DRES connected to a transformer cannot exceed 90% of its capacity, with a maximum of 30% per phase.

Exemptions and New Energy Concepts

The regulation provides exemptions from transmission, wheeling, banking, and cross-subsidy charges for most DRES configurations, although additional charges may apply depending on network usage and metering arrangements.

Recently, OERC retained the previous year’s retail power supply tariff structure for the financial year 2026-27, covering energy charges, demand charges, rebates, and surcharges across consumer categories.

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