The Appellate Tribunal for Electricity (APTEL), in a recent order, directed the Maharashtra State Electricity Distribution Company Limited (MSEDCL) to grant open access facility to four wind developers and also compensate them for the banked energy until the full quantum of open access is granted.
Four wind generators in Maharashtra – Roha Dyechem, Arvind Cotsyn, Jsons Foundry, and Western Precicast, had appealed to APTEL, demanding grant of open access. The generators also asked for MSEDCL to be directed to compensate for the banked energy.
APTEL took the case of Jsons Foundry as all the four appeals were similar.
Wind generator Jsons Foundry owns wind power projects of a total capacity of 6.82 MW in Maharashtra.
The MSEDCL granted open access for captive use from its Unit-I (3.40 MW) and Unit-II (3.42 MW).
In its impugned order dated September 9, 2019, the state electricity regulator rejected the appellant’s claim for the banked energy above the contracted demand. Aggrieved by this decision, Jsons Foundry filed the appeal for redressal with APTEL.
Jsons Foundry, in its submission, said that solar power might reach the highest capacity during a certain time of day, and the generation of power may exceed the contract demand, whereas, in the case of wind, it was not the same.
Jsons Foundry said that it had sought open access from its wind projects with a capacity of 3.40 MW from Unit I and 3.42 MW from Unit II. The projects being old, the capacity utilization factor (CUF) was only 17%. The contract demand concerning Unit-I was 2000 KVA equivalent to 2 MW, and Unit-II was 1,495 KVA equivalent to 1.495 MW. Therefore, the wind power generated within such contract demand at benchmark CUF was (3.4 MW x 20% = 0.68 MW and 3.42 MW x 20% = 0.684 MW). Therefore, the contention of MSEDCL that the resultant power flow cannot be accommodated was incorrect, it argued.
The wind generator said that unless MSEDCL can prove that the power sought under open access cannot be accommodated, the permission for open access cannot be denied.
The Tribunal observed that the electricity distribution company (DISCOM) had interpreted the provision of banking given in the Wind Tariff Order, 2003 so that a renewable energy generator cannot bank excess power of over 10% of the energy generated by the project at any point in time. Based on this interpretation, DISCOM had curtailed the open access approval sought by the wind generator.
The wind generator had submitted that such interpretation made by MSEDCL was wrong, and the state Commission should not have accepted such an interpretation.
APTEL noted that the appellant had submitted that as per the Wind Tariff Order, 2003, energy banking was allowed for one year, and therefore the interpretation made by MSEDCL was wrong, calling for rejection.
APTEL observed that in the case of renewable energy sources, the situation was different as the generation depended on the availability of wind and solar, which meant that the energy is generated only when adequate wind and sunlight was available. It meant that the electricity is generated during times when the captive user did not require it.
The Tribunal further noted that the state Commission had decided that surplus energy at the end of the financial year, limited to 10% of the energy fed into the grid during the financial year, would be purchased by the utility. This purchase was for tariff applicable on March 31 of the financial year in which the energy was banked.
“It would be wrong to infer that the limitation of 10% is on the banking of excess energy generated instantaneously by the renewable generator. This is more so given the provision of banking of energy because if that be so, it will defeat the very purpose of banking. We believe that the findings of the Commission that the provision of the banking as provided by the state Commission in their Wind Tariff Order, 2003, are essentially to be used for adjusting excess generation only on margin is wrong,” the Tribunal noted.
Further, the Tribunal observed that it was clear from the reading of the open access regulations that the only test to be applied by the distribution licensee is to verify the feasibility of infrastructure and capacity of the distribution system so that the resultant power flow can be accommodated in the existing distribution system.
The DISCOM had interpreted the statement of the state Commission where it was recorded that the developer would be expected to limit the size of the project as per its requirement of energy.
The State Commission had accepted this contention of DISCOM and rejected the generator’s claim to direct the DISCOM to grant open access.
After considering all the facts, the Tribunal allowed the requests of all the four appellants.
In January this year, APTEL set aside an order of the Tamil Nadu State Electricity Regulatory Commission regarding the banking of energy, terming it unjust. The Tribunal reiterated that energy banking for renewable energy projects would continue, and the state commissions should not tamper with the provision.
Rakesh 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). More articles from Rakesh Ranjan.