The purchase of renewable energy by captive open access consumers from distribution companies (DISCOMs) in Andhra Pradesh will be counted toward the fulfillment of their renewable power purchase obligation (RPO), according to draft regulations issued by the Andhra Pradesh Electricity Regulatory Commission (APERC).

The regulator issued draft amendments to the Renewable Power Purchase Obligation Compliance by Purchase of Renewable Energy/ Renewable Energy Certificates Regulations, 2022.

The proposed amendments cover the issue of RPO compliance and provide clarity regarding the procurement of green power from DISCOMs.

Background

Last year, APERC issued the Compliance by Purchase of Renewable Energy/Renewable Energy Certificates Regulations, 2022 specifying RPO percentages for obligated entities and the sources of procurement of renewable energy for meeting their RPO.

Subsequently, the Government of India issued Green Energy Open Access Rules, 2022, in June, specifying DISCOMs as one of the sources for renewable energy procurement by obligated or non-obligated entities at the green tariff determined by the state electricity regulatory commissions.

Later, the Ministry of Power suggested that the green tariff in no case should be higher than the Average Power Purchase Cost of renewable energy + surcharge at 20 % of the Average Cost of Supply + a margin of ₹0.25 (~$0.003). The Commission invited views and suggestions from the DISCOMs on the green tariff suggested by the government.

The Commission noted that the DISCOMs have surplus renewable energy over and above their RPO targets as per the RPO Order for FY 2023-24, and for balancing the interest of all the stakeholders, it had issued amendments to the Compliance by Purchase of Renewable Energy/ Renewable Energy Certificates Regulations, 2022.

Renewable Energy Procurement

As per the proposed amendments, entities can buy renewable energy up to a specified percentage of their consumption or their entire consumption. To do so, they must submit a request to DISCOM three months before the start of the financial year in which they intend to procure renewable energy, starting from FY 2024-25.

For the remaining period of FY 2023-24, entities can submit a request to their DISCOM within one month from the date when this regulation takes effect. The DISCOM will then procure the required amount of renewable energy and provide it to the respective entities.

Obligated entities can purchase more renewable energy voluntarily, exceeding their obligation up to a maximum of 100%. The percentage of renewable energy that obligated and non-obligated entities must procure from the DISCOMs should not be lower than the RPO specified by the Government of India or APERC for obligated entities, whichever is higher for that particular financial year.

The renewable energy supplied by the DISCOM in FY 2023-24 will have a green tariff of ₹0.75 (~$0.009) added to the regular applicable tariff for the respective entities for FY 2023-24.

Any energy consumed by the entities from the DISCOMs, at ₹0.75 (~$0.009) above the normal tariff, will be considered as renewable energy supplied by the DISCOM for that billing month.

The DISCOM will issue the monthly digital certificate to such consumers certifying the quantity of renewable energy out of the total consumption.

All electricity consumers in the state can obtain 100% renewable energy by paying an additional green tariff for their respective categories without the need to select an existing Green Power category.

When placing a request for renewable energy from a DISCOM, the minimum duration will be one year starting from FY 2024-25.

Further, any renewable energy purchased from the DISCOM that exceeds the RPO of an obligated entity, as well as 100% of the energy procured by non-obligated entities, will count towards the RPO compliance of the DISCOMs.

The DISCOM’s revenue generated from selling renewable energy to consumers through the green tariff will be classified as power sales revenue. The DISCOM will maintain separate accounting records for the number of consumers, connected load, sales, and revenue generated under the green tariff for each tariff category and sub-category.

On an annual basis, the DISCOM will issue a Green Stars Certificate to entities for the renewable energy supplied beyond the RRPO targets set by the Government of India or APERC, whichever is higher. The DISCOM will issue the Green Stars Certificates to all eligible entities within three months after the completion of that particular financial year.

Also, non-obligated entities of any category, including domestic consumers at any voltage level, may opt to procure renewable energy.

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