Uttar Pradesh Electricity Regulatory Commission (UPERC) has released draft regulations for captive and renewable energy generating projects. All stakeholders must submit their written comments by May 30, 2025.

For generating projects commissioned on or after April 1, 2009, these projects will retain 100% of gross proceeds on account of the clean development mechanism during the first year of commercial operation. From the second year onwards, the procurer’s share will increase yearly by 10% until it reaches 50%.

The electricity supply tariff from generating projects having more than one unit commissioned in different years will be based on the weighted average of the tariff of contracted capacities of the units commissioned in different years.

For bagasse and biomass or renewable energy projects, the electricity supply tariff during the unit’s synchronization and the date of commercial operation (COD) must equal the variable cost.

Additionally, for full-capacity charge recovery for biomass and bagasse-based projects, the plant load factor must be 50%.

Distribution licensees must apply for approval of power purchase agreements (PPAs) with the generating projects. They must also furnish data on the energy received from different captive and renewable energy projects.

The Commission also said that any person who establishes, maintains, and operates a generating project may also purchase electricity through open access or from their area’s distribution licensee to meet their electricity requirement.

The generating projects must abide by grid discipline and will not be entitled to any compensation for grid failures. The deviation settlement mechanism provisions will be implemented for all generating projects except for small hydro projects and municipal solar waste plants.

Procedure for Declaration of COD

The renewable energy power developer will declare the COD as stipulated in the approved PPA.

During the project’s synchronization and commissioning, when registering it with the Uttar Pradesh State Load Despatch Centre (UPSLDC), the solar power developer must specify the proposed capacity for each stage, phase, or unit under the Draft UPERC CRE Regulations, 2024.

Developers must give a notice of at least seven days to UPSLDC/state transmission units (STUs)/synchronous power controllers and the solar power generation station’s beneficiaries before conducting a trial run.

The solar projects or part of the projects’ (stage/phase/unit) trial run must be performed for a minimum capacity of 10% of the project (the first minimum being 5 MW). After the trial run’s completion, beneficiaries with objections must convey them in writing to UPSLDC within two days.

A trial run will be deemed successful if the developer maintains peak generation, matching the capacity for which the COD/part COD is requested, for one 15-minute block on at least three days within a continuous two-week period.

Upon receiving the successful trial run certificate from the state load dispatch centre (SLDC), the developer may issue a COD or part-COD declaration, duly signed by its authorized signatory.

Any captive generating project seeking open access through the state and/or interstate transmission and distribution systems to transport electricity to the destination of use must pay the transmission, wheeling, and any other charges for utilizing these facilities as determined by the appropriate commission.

The distribution licensees will receive a 100% exemption on the sale of power to distribution licensees, a 50% exemption for captive use and third-party sales, and a 100% exemption on the intrastate transmission system as well as the cross-subsidy surcharge.

Energy Banking

The existing and new captive generating projects, which fulfill the criteria provided in UPERC (Verification of Generating Plants and Captive Consumers) Regulations, 2022, may be allowed to bank energy for captive/own use during the control period’s application.

They must enter a wheeling and banking agreement with the distribution licensees.

For bagasse, the ceiling of banking energy is 49% of the energy injected during the quarter. For renewables other than bagasse, the ceiling is 25% of the energy injected during the month or 30% of the total monthly electricity consumption.

A 100% energy banking in mega-watt terms will be allowed on a 15-minute time block basis. The withdrawal of banked energy will be adjusted on a ‘first in, first out’ basis. Energy banked in the off-peak hours will be allowed withdrawal only in off-peak hours.

Power Evacuation

Renewable energy and captive generating projects will supply power to the distribution licensee of its area through an 11 kV or higher voltage line terminating at the nearest 33 kV/132 kV sub-station per the voltage and capacity as given below:

• Contracted capacity up to 3 MW on 11 k
• Contracted capacity above 3 MW and up to 20 MW on 33 kV
• Contracted capacity above 20 MW on 132 kV

Generating projects will be responsible for constructing the evacuation system for connecting their systems to the substation.

They will also maintain terminal equipment and dedicated transmission lines at the generating project’s end. The operation and maintenance costs will be considered as pass through by the Commission while determining the wheeling and transmission charges of the concerned licensee or STU.

They will also provide energy meters as specified in the Central Electricity Authority (Installation and Operation of Meters) Regulations, 2006.

The SLDC will be responsible for accounting and billing. The same will be communicated to the utilities interacting with the grid per the scheme framed by the SLDC under the provisions of the UPERC regulations.

If the sale is made to the distribution licensee without using the transmission network of the area, a joint meter reading will be conducted.

The Commission can add, vary, alter, modify, or amend any provision of these regulations at any time.

Recently, UPERC approved NIDP Developers’ request for a tariff of ₹5.95 (~$0.07)/kWh for procuring 5 MW of bagasse-based round-the-clock power between April 1, 2025, and July 31, 2025.

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