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					</table><p>The Odisha Electricity Regulatory Commission (<a href="https://www.orierc.org/(S(y3vjgwsoyynlx50fznxnieet))/default.aspx" target="_blank" rel="noopener">OERC</a>) recently directed the Odisha Power Transmission Corporation (<a href="https://optcl.co.in/" target="_blank" rel="noopener">OPTCL</a>) and Bharat Electronics (<a href="https://bel-india.in/" target="_blank" rel="noopener">BEL</a>) to finalize the contracted capacity for the transmission of power utilizing the transmission network of OPTCL for long-term access.</p>
<p>It directed the parties to amend the transmission capacity access agreement (TCAA) between them.</p>
<p>The state regulator added that BEL could not be exempted from paying under injection charges to GRIDCO if the power injected from its captive power project was less than what was scheduled.</p>
<p>Further, the Commission rejected BEL’s request to grant a net metering mechanism for its 7.5 MW solar captive power project.</p>
<p>The Commission noted that as per the existing net metering and bi-directional metering and their connectivity order, the upper limit of the installed capacity of the solar power project should be 500 kW to avail the benefit of net metering.</p>
<p>In contrast, the installed capacity of BEL’s captive power project was 7.5 MW. Hence the net metering facility was not available for the captive power project.</p>
<p>OPTCL and BEL had filed two separate petitions with the state Commission. OPTCL had sought directions to BEL for the payment of open access charges. BEL had requested the Commission to adjudicate the dispute on the ‘arbitrary, illegal levy and collection’ of various open access charges under the Open Access Regulations 2020.</p>
<p><strong>Background</strong></p>
<p>BEL has a solar captive power project of 7.5 MW capacity at the Ordnance factory, Badmala, in the Bolangir district of Odisha. BEL entered into a  transmission capacity access agreement with OPTCL on August 7, 2018, per OERC Open Access Regulations 2005, to avail open access for its solar power to the ordnance factory for 25 years through the transmission network of OPTCL on payment of long-term open access charges.</p>
<p>OPTCL noted that the agreement nowhere provided that in the case the Open Access Regulations 2005 were repealed, BEL would be governed by the new regulations.</p>
<p>As per the Open Access Regulations 2020, OPTCL had to raise transmission bills to BEL based on its contracted capacity from November 2020.</p>
<p>In the absence of any declared contracted capacity by the captive power generator, OPTCL raised the transmission charge bills to BEL from November 2020, considering the contracted capacity as 7.35 MW for FY 2021, which was the maximum scheduled injection observed during FY 2020.</p>
<p>However, BEL protested this new billing method and suggested OPTCL to raise the transmission charges based on the scheduled generation or the actual wheeled units for the month and continue to pay the transmission charges based on the scheduled injection energy.</p>
<p>BEL submitted that the Commission enforced new Open Access Regulations 2020 by repealing the earlier Open Access Regulations 2005. Regulation 44 of the Open Access Regulations 2020 has a provision for non-applicability of the said regulations on existing open access customers to the intrastate transmission and distribution system where there is an existing agreement.</p>
<p>In light of the above, the levy of revised transmission charges by OPTCL is illegal and has no basis in law.</p>
<p>BEL added that owing to the lack of a banking facility, approximately 3 to 4 MU per annum was being injected by them into the state grid free of cost with undue enrichment of GRIDCO, which caused a loss of revenue.</p>
<p>GRIDCO initially agreed to buy the surplus solar power at ₹4.50 (~$0.055)/kWh for 25 years after the captive consumption by the ordnance factory but refused to purchase the excess solar power.</p>
<p>Further, the captive power generator stated that GRIDCO was levying Deviation Settlement Mechanism (DSM) charges on BEL, which was illegal since the Commission had not formulated any regulations for levying DSM charges.</p>
<p><strong>Commission’s analysis</strong></p>
<p>The Commission observed that the agreement states that the open access transaction between BEL and OPTCL should be governed per the provisions of Open Access Regulations, 2005.</p>
<p>However, per the Open Access Regulations 2020, the transmission charges should be payable based on the contracted capacity for long-term and medium-term open access customers.</p>
<p>Since the term ‘contracted capacity’ had neither been defined in the regulations nor the TCAA, OPTCL had claimed transmission charges based on the contracted capacity of 7.35 MW for FY 2021 and 5 MW for FY 2022 based on the maximum scheduled injection for the previous year and 1.814 MW for the FY 2023. BEL intimated OPTCL to consider a contracted capacity of 1.814 MW for FY 2023.</p>
<p>The Commission noted that it would be prudent to compute the transmission charges for open access transactions by BEL considering the 1.814 MW for FY 2021 and FY 2022. It directed both parties to finalize the contracted power transmission capacity utilizing the transmission network of OPTCL for long-term access and accordingly make amendments to their agreement.</p>
<p>OERC noted that even if it was found that GRIDCO adopted the rates of CERC’s DSM Regulations to impose penalty in case of lesser or higher injection into the grid, in the absence of separate DSM Regulations, the same could not be termed illegal.</p>
<p>BEL could convince GRIDCO to purchase surplus solar power from its captive power project through an agreement at a mutually agreed rate, the Commission said.</p>
<p>It further advised GRIDCO to explore the possibility of entering into PPA with BEL to purchase surplus power from its solar captive power project at a negotiated price, as it may require such power to meet its renewable purchase obligation in the future.</p>
<p>Earlier, OERC had <a href="https://mercomindia.com/odisha-proposes-revisions-deviation-settlement-regulations/" target="_blank" rel="noopener">issued</a> the revised draft ‘Deviation, Settlement Mechanism, and Related Matters Regulations, 2022’ to ensure that users of the grid adhere to their schedule of drawal and injection of electricity for the security and stability of the grid.</p>
<p>Subscribe to Mercom’s real-time <a href="https://mercomindia.com/product/mercoms-renewable-energy-regulatory-updates/" target="_blank" rel="noopener">Regulatory Updates </a>to ensure you don’t miss any critical updates from the renewable industry.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/rakesh-ranjan-parashar/" class="vcard author" rel="author"><span class="fn">Rakesh Ranjan</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/02/Rakesh-Headshot-crop-2.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Rakesh Ranjan,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" target="_blank" rel="noopener">More articles from Rakesh Ranjan.</a></p>
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<p><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/02/Rakesh-Headshot-crop-2.jpg" width="77" height="102" /><a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" target="_blank" rel="noopener"><strong style="color: #00b451">Rakesh Ranjan</strong></a> is a staff reporter at Mercom India. Prior to joining Mercom, he worked in many roles as a business correspondent, assistant editor, senior content writer, and sub-editor with bcfocus.com, CIOReview/Silicon India, Verbinden Communication, and Bangalore Bias. Rakesh holds a Bachelor’s degree in English from Indira Gandhi National Open University (IGNOU). <a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" rel="noopener noreferrer">More articles from Rakesh Ranjan.</a>
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Regulator Directs Captive Solar Power Generator to Pay Transmission Charges


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					</table><p>Indian Oil Corporation (<a href="https://iocl.com/" target="_blank" rel="noopener">IOCL</a>) has invited bids to purchase 50 acres of land to set up a 10 MW solar power project in Odisha.</p>
<p>The last date to submit the bids is September 26, 2022. Bids will be opened the following day.</p>
<p>Bidders will have to submit ₹50,000 (~$624.64) as an earnest money deposit.</p>
<p>The offered land must be preferably continuous, measuring a minimum of 50 acres. The land must be located within 10 km of the Odisha Power Transmission Corporation (OPTCL) substations. It should be connected with an approach road, and the land should be free from all encumbrances.</p>
<p>Preference will be given to government land if found suitable.</p>
<p>The undulation in the land should be within the range of two meters concerning the adjacent road, which should be cross-verified by a consultant on behalf of IOCL.</p>
<p>There should be provision for potable water arrangements and ease of getting electrical power. The land should not be below the mean sea level and should not be a wetland. The land should not be located in a densely populated area.</p>
<p>The consultant will conduct the survey of the right of way (RoW) of the transmission line from the land to the nearest OPTCL substation.</p>
<p>The consultant will conduct the land survey to identify the depth of land from the adjacent road and the quantity of earth required for filling and leveling the land.</p>
<p>Landed cost will consist of the offered cost of land, transmission cost up to the nearest OPTCL grid for power evacuation, RoW cost, and landfilling cost. The L1 bidder will be identified based on the landed cost.</p>
<p>Last month, IOCL and NTPC <a href="https://mercomindia.com/ioc-ntpc-supply-renewable-power-indian-oil-refineries/" target="_blank" rel="noopener">signed</a> an agreement to form a joint venture company to meet the power requirements of upcoming projects of Indian Oil refineries with renewable power.</p>
<p>Earlier, IOCL had <a href="https://mercomindia.com/indian-oil-floats-empanelment-tender/" target="_blank" rel="noopener">invited</a> bids to empanel vendors to develop solar projects at its locations and retail outlets across India. The scope of work included the project&#8217;s design, engineering, testing, supply, packing, transportation, storage, installation, and commissioning.</p>
<p>According to Mercom&#8217;s <a href="https://mercomindia.com/product/india-solar-project-tracker/" target="_blank" rel="noopener">India Solar Tender Tracker</a>, IOCL has floated tenders for 64 MW of solar projects.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/rakesh-ranjan-parashar/" class="vcard author" rel="author"><span class="fn">Rakesh Ranjan</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/02/Rakesh-Headshot-crop-2.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Rakesh Ranjan,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" target="_blank" rel="noopener">More articles from Rakesh Ranjan.</a></p>
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<p><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/02/Rakesh-Headshot-crop-2.jpg" width="77" height="102" /><a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" target="_blank" rel="noopener"><strong style="color: #00b451">Rakesh Ranjan</strong></a> is a staff reporter at Mercom India. Prior to joining Mercom, he worked in many roles as a business correspondent, assistant editor, senior content writer, and sub-editor with bcfocus.com, CIOReview/Silicon India, Verbinden Communication, and Bangalore Bias. Rakesh holds a Bachelor’s degree in English from Indira Gandhi National Open University (IGNOU). <a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" rel="noopener noreferrer">More articles from Rakesh Ranjan.</a>
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Indian Oil Invites Bids to Purchase Land for a 10 MW Solar Project in Odisha

<p><a href="http://vedantaaluminium.com/" target="_blank" rel="noopener">Vedanta Limited</a>,  a diversified natural resources company, has invited  Expression of Interest (EoI) for the procurement of solar power under short or medium term basis from solar power generators, state electricity boards and utilities, independent power producers and traders.</p>
<p>The delivery point for the generated power will be Vedanta Limited’s premises in Odisha’s Jharsuguda. The minimum bid capacity is 20 MW and the maximum has been fixed at 300 MW.</p>
<p>The last date for bid submission is January 8, 2019. The price bid will open on January 10, 2019.</p>
<p>The successful bidders will enter into a power purchase agreement (PPA) within 15 days from the date of issuance of the letter of acceptance (LOA). They will also have to furnish a contract performance guarantee (CPG) within seven days of completion of the bidding process. Apart for these, the successful bidders will have to book the open access transmission corridor by applying to nodal regional load dispatch centers.</p>
<p>The traders submitting bids should have a valid license from the Central Electricity Regulatory Commission (CERC) or State Electricity Regulatory Commissions (SERC) for inter or intra-state trading of electricity.</p>
<p>Moreover, the EoI states that none of the parties will be liable to each other on account of failure or delay caused by unforeseeable circumstances (force majeure). Either of the two parties can terminate the agreement by giving an advance notice of 30 days to the other party.</p>
<p><a href="https://mercomindia.com/vedanta-eoi-captive-solar-project-rajasthan/" target="_blank" rel="noopener">Earlier,</a> Mercom reported that Vedanta Limited was planning to develop a solar project with a minimum capacity of 20 MW and a maximum capacity of 50 MW for captive consumption in Rajasthan’s Barmer district.</p>
<p><a href="https://mercomindia.com/oreda-tenders-6mw-solar-for-hal/" target="_blank" rel="noopener">In June 2018</a>, the Odisha Renewable Energy Development Agency (<a href="http://oredaodisha.com/" target="_blank" rel="noopener">OREDA</a>) tendered a 6 MW grid-connected solar project on behalf of Hindustan Aeronautics Limited (HAL) in Koraput, Odisha.</p>
<p>Image credit: RESOL</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/nitin/" class="vcard author" rel="author"><span class="fn">Nitin Kabeer</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><p><img class="alignleft wp-image-9822" src="https://mercomindia.com/wp-content/uploads/2018/04/nitin-2.png" alt="" width="99" height="105" /><span style="font-family: Calibri"><span style="color: #000000"><span>Nitin is a staff reporter at Mercomindia.com and writes on renewable energy and related sectors. Prior to Mercom, Nitin has worked for CNN IBN, India News, Agricultural Spectrum and Bureaucracy Today. He received his bachelor’s degree in Journalism &amp; Communication from Manipal Institute of Communication at Manipal University and Master’s degree in International Relations from Jindal School of International Affairs. <a href="https://mercomindia.com/author/nitin/">More articles from Nitin Kabeer</a></span></span></span></p>
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Vedanta’s Odisha Branch Invites Expression of Interest for Procuring Solar Power

<p>Demonetization has been chaotic and changing the way the Indian economy functions. For the power sector, demonetization has turned out to be a positive event with distribution companies (DISCOMs) recovering pending power bills from their customers and banks suddenly flush with funds, all of which could relax lending to the power sector and potentially bring down interest rates.</p>
<p>The government has mandated that the old notes of Rs.500 and Rs.1000 denominations can be used by the citizens to pay pending utility bills which will help DISCOMs due to their huge backlog of unpaid bills. DISCOMs are expecting a substantial influx of payments prior to the December 31 deadline after which these currency notes will become invalid. For cash-strapped DISCOMs this is unexpected good news.</p>
<p>An official at Maharashtra State Electricity Distribution Company Limited (MSEDCL) stated, “since the announcement of demonetization, DISCOMs in the state have seen payments of old bills cross Rs. 1 billion ($14.74 million) within a week. The signs are positive as this will financially empower the DISCOMs.”</p>
<p>Due to the amnesty of taxes and penalties provided to black money holders (unaccounted currency), the government will have a huge influx of money that can be allocated for infrastructural development and funding new projects, stated an official at Transmission Corporation of Telangana Limited (TCTL).</p>
<p>An official at the Ministry of New and Renewable Energy (MNRE) said, “India is largely a cash economy so in the short-term demonetization is going to hurt installations as small developers will find it tough to pay for land acquisition, but, in the long-term it will be beneficial as DISCOMs will get paid, lending rates will fall and foreign investment will increase in the face of a falling rupee and rising dollar.”</p>
<p>There are many ambitious projects like the <a href="http://mercomcapital.com/pgcil-seeks-$1-billion-loan-from-adb-to-set-up-green-energy-corridor" target="_blank" rel="noopener noreferrer">Green Energy Transmission Corridor</a> that require large investments. With consumers repaying pending bills and government taxing defaulters, nodal agencies foresee better fund allotment from the government in the future, commented an official at Bihar State Power Holding Company Limited (BSPHCL).</p>
<p>Officials at Jharkhand Renewable Energy Development Agency (JREDA), Odisha Power Transmission Corporation Limited (OPTCL) and Power Management Company, Madhya Pradesh, all concurred: due to demonetization, peace is being restored in regions like Jammu &amp; Kashmir, and Jharkhand, Madhya Pradesh, Odisha, Andhra Pradesh [insurgency belt] as insurgents find it hard to fund their operations. This will uplift the morale of developers in these regions and installations will pick up.</p>
<p>Tamil Nadu Generation and Distribution Corporation (TANGEDCO) received <a href="https://mercomindia.com/tepid-response-tangedcos-500-mw-rfs-tamil-nadu-117-mw-bids-received-far/" target="_blank" rel="noopener noreferrer">tepid response</a> for its 500 MW tender due to demonetization, but it was an exception said an official at MNRE.</p>
<p>An official at Uttar Pradesh Power Transmission Corporation (UPPTCL) stated that the state has been a classic example for unpaid electricity bills. Now the DISCOMs can get some relief with consumers using their stashed cash to pay pending bills as well as advance payment for future month’s electricity bills in some cases.</p>
<p>A slew of government funded projects and subsidies are expected as cash deposits increase in banks, an official at the Rajasthan Renewable Energy Corporation commented.</p>
<p>The lending community is cautious and feels that it is too early to predict if all this money that is flowing into the banks right now is here to stay. There is a possibility that the funds deposited could be withdrawn after December 2016. But, on the flip side they are also aware of the fact that they cannot have a situation where the deposits and cash balances are much higher than lending, leading to “negative carry” (a situation in which the income earned from a loan is less than the bank’s cost of deposits).</p>
<p>Developers whom we spoke to and who have won bids recently are concerned about payments to construction workers, on-time work completion and the availability of cash to take care of such expenses. However, they are also hoping to see reduction in lending rates that would help bring down the project cost and in turn boost their project IRRs.</p>
<p>“Demonetization, though chaotic, is turning out to be an overall positive event for the renewable sector in the long run. This combined with the rapid decline in solar component costs is making a lot of low questionable bids feasible. However, we have to wait and see how government agencies handle the situation &#8211; especially payment issues &#8211; going forward,” commented Raj Prabhu, CEO of Mercom Capital Group.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/raj/" class="vcard author" rel="author"><span class="fn">Raj Prabhu</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/04/Raj-New-200X200-1.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Raj Prabhu,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/raj/" target="_blank" rel="noopener">More articles from Raj Prabhu.</a></p>
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<img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/04/Raj-New-200X200-1.jpg" alt="Raj" /><a href="https://mercomindia.com/author/raj/" target="_blank" rel="noopener"><strong style="color: #00b451">Raj Prabhu</strong></a> is a recognized thought leader in clean energy markets where his work has influenced policies worldwide. He has a deep understanding of regulatory policy and clean energy markets and his market and opinion pieces are regularly published on both MercomIndia.com and other leading publications globally. Raj is also a regular speaker and presenter on clean energy policy and finance topics at conferences worldwide. Raj attended the KLE College of Science in Bangalore, India for physics and chemistry, and holds a Bachelor of Science Degree in Hotel and Institutional Management from Johnson and Wales University, Rhode Island. <a href="https://mercomindia.com/author/raj/">More articles from Raj Prabhu.</a></div>
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