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SWELECT Energy to Raise ₹1.38 Billion via Debenture Sale

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					</table>According to Mercom India&#8217;s Q1 2024 Solar Open Access Market Report, India added 1.8 GW of solar open access capacity in Q1 2024, with Rajasthan leading with almost 28% of the quarter&#8217;s installations.
Rajasthan&#8217;s capacity additions were up 154.1% quarter-over-quarter, making it one of the top five states for solar open access. The state&#8217;s cumulative installed solar open access capacity rose 65.9% between Q4 2023 and Q1 2024. In Q1 2024, about 13.7% of the large-scale solar installations in the state were in the open access model.
Open access solar installations in Rajasthan accounted for 8.8% of India&#8217;s cumulative capacity.
Enabling Environment 
Rajasthan&#8217;s impressive solar open access growth can be attributed to abundant solar radiation, land availability, and stable energy banking regulations.
In Q1 2024, a significant number of solar open access projects with signed PPAs and advanced development stages received DISCOM approvals.
The exemption from facilitation charges for captive and group captive projects under the state&#8217;s renewable energy policy has increased the attractiveness of these models for C&amp;I consumers despite the regulatory challenges from state DISCOMs.
Rajasthan had the second-largest solar open access project pipeline as of March 2024.
<img loading="lazy" decoding="async" class=" wp-image-68749 aligncenter" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1-300x129.jpg" alt="Rajasthan open-access-1" width="680" height="292" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1-300x129.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1-768x330.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1-650x279.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1-624x268.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1-600x258.jpg 600w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1.jpg 1056w" sizes="(max-width: 680px) 100vw, 680px" />
In Rajasthan, a power purchase agreement between the developers and consumers above 12 years but not more than 25 years is defined as long-term. Agreements tenures of one month and below are considered short-term.
Savings for C&amp;I Segment
Rajasthan&#8217;s industrial consumers can save up to ₹2.87/kWh ($0.034/kWh) via intrastate captive and group captive projects, while commercial consumers can save up to ₹4.42/kWh ($0.053/kWh). Industrial consumers can save up to nearly 39% of the tariffs levied by DISCOMs, and commercial consumers can save up to almost 50%.
Energy-intensive consumers in sectors like textile, food processing, metal, dairy, defense, cement, healthcare, and chemical industries can benefit from procuring solar via open access route to lower their electricity expenses.
<img loading="lazy" decoding="async" class=" wp-image-68750 aligncenter" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1a-300x194.jpg" alt="Rajasthan open-access-1a" width="446" height="288" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1a-300x194.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1a-768x497.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1a-650x420.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1a-624x403.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1a-600x388.jpg 600w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/08/Rajasthan-open-access-1a.jpg 897w" sizes="(max-width: 446px) 100vw, 446px" />
India&#8217;s energy landscape is rapidly <a href="https://www.mercomindia.com/addressing-bottlenecks-critical-access-solar-growth" target="_blank" rel="noopener">evolving</a>, with solar power emerging as a crucial component of the country&#8217;s renewable energy mix. Among the various options, solar open access has shown the most promise.
Mercom India&#8217;s <a href="https://www.mercomindia.com/product/q1-2024-mercom-india-solar-open-access-market-report" target="_blank" rel="noopener">Q1 2024 Solar Open Access Market</a> Report provides an in-depth analysis of the state-wise open access market and data on electricity tariffs and open access charges.

Enabling Policies Drive Rajasthan’s Solar Open Access Projects in Q1 2024

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					</table>India added 3.2 GW of new solar open access capacity in 2023, the most in any calendar year to date, with the top five states accounting for 84.2% of the new installed capacity.
The installations surged 5.7% YoY from 3 GW in 2022, according to the recently released <a href="https://www.mercomindia.com/product/q4-2023-mercom-india-solar-open-access-market-report" target="_blank" rel="noopener">2023 Q4 and Annual Mercom India Solar Open Access Market Report</a>.
The Approved List of Models and Manufacturers (ALMM) order suspension and the fall in module prices helped significantly reduce project costs during the year.
Lower costs allowed developers to offer open access solar power at significantly lower tariffs, leading to higher capacity additions. Most of the installations during the year were executed under the captive and group captive models across the top states.
Here is a look at the top states for open access.
<img loading="lazy" decoding="async" class="aligncenter wp-image-65141 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1.png" alt="Open Access Solar Installations 2023" width="3761" height="1802" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1.png 3761w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1-300x144.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1-2000x958.png 2000w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1-768x368.png 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1-1536x736.png 1536w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1-2048x981.png 2048w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1-650x311.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1-624x299.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/04/Picture1-600x287.png 600w" sizes="(max-width: 3761px) 100vw, 3761px" />
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Karnataka
Karnataka led the solar open access installations in CY 2023 as well cumulatively, accounting for 27.9% and 33.1%, respectively, of the total capacity.
Solar Open access represented 99.8% of the large-scale solar projects installed in the state during the year and 42.1% of the cumulative large-scale solar capacity.
Solar-wind hybrid projects accounted for 14.3% of the cumulative solar open access installed capacity.
According to Mercom India Research, in 2023, the cement, metallurgical, automobile and auto parts, dairy, electronic hardware, and pharmaceutical industries were the main off-takers of open access power.
Gujarat
Gujarat had the second-highest solar open access installations, accounting for 16.4% of the new capacity added in 2023. The state ranked fourth with respect to cumulative installations, accounting for 7.6% of the total solar open access capacity.
In 2023, 42% of large-scale solar installations in Gujarat were under the open access model, and cumulatively, the model accounted for ~13.3% of the state&#8217;s total large-scale solar capacity.
In 2023, the main off-takers of open access power were the jewelry, textiles, metallurgy, silk, steel, healthcare, printing, petrochemical, engineering services, chemical, and steel industries.
Gujarat&#8217;s renewable-based hybrid power policy and favorable weather conditions have been highly conducive for solar-wind hybrid open access projects.
Solar-wind hybrid projects accounted for 77.7% of the solar open access capacity commissioned in 2023 and 55.6% of the cumulative capacity.
The state has favorable banking regulations for solar-wind hybrid projects, permitting monthly energy banking while requiring daily banking for solar open-access projects.
It has also announced an amendment allowing captive customers to hold a minimum equity stake of 26% cumulatively in a group captive project per electricity rules, as opposed to the previous 100% requirement for captive approvals.
Maharashtra
Maharashtra came in at a close third in terms of new solar open access capacity added in 2023, accounting for 16.2%. The state ranks second for cumulative solar open access installations at 13.5%.
Solar open access in the state accounted for 38.6% of the cumulative large-scale capacity and 79.5% of the large-scale projects installed in CY 2023.
All the installations in the state were standalone solar projects. Even with a good potential for solar-wind hybrid projects, the growth is stalled in the absence of distinct hybrid policies.
The energy tariff in Maharashtra remained unchanged from the previous quarter and is the highest among C&amp;I customers. The primary incentives to opt for solar open access were high retail tariffs and potential savings.
The state saw a significant decline in project commissioning in Q4 2023. Several projects scheduled for commissioning during the quarter were pushed to the next quarter as consumers anticipated lower PPA prices.
During the quarter, the state also hiked the banking charges for open access projects from 2% to 8%. The higher banking charges are expected to cut the financial benefits of open access for C&amp;I consumers.
In 2023, the primary off-takers of solar open access were the chemical, metallurgical, paper, plastic, pharmaceutical and cosmeceutical, data centers, telecommunications, seaports, automobile and auto component, dairy, and IT industries.
Tamil Nadu
Tamil Nadu stood fourth on the list for installations in CY 2023, accounting for 15.6% of the total capacity. The state accounted for 11.4% of the cumulative solar open access capacity.
Solar open access projects in Tamil Nadu account for 25.8% of the large-scale installations in the state and 94.6% of such additions in CY 2023.
Solar-wind hybrid projects accounted for 12.7% of the cumulative installed solar open access capacity.
Tamil Nadu released an annual tariff update in July 2023, increasing its retail supply costs by 2.2%-2.5% for C&amp;I consumers, driving them to adopt solar open access to save on energy costs. The updated tariff order also exempted additional surcharges for open access projects, which helped boost installations under the state&#8217;s third-party open access model.
A well-structured regulatory framework and Tamil Nadu Generation and Distribution Corporation&#8217;s (TANGEDCO) accelerated approvals for captive and group captive projects have helped in the addition of new solar open access capacity.
In 2023, the main off-takers of open access power were cement, sugar, leather, metallurgy, automobile and auto parts, dairy, electronic hardware, petroleum and gas, glass, and other small-scale local industries.
Rajasthan
Rajasthan was fifth on the list, accounting for 8.1% of the new capacity added in 2023. The state accounted for 6.1% of India&#8217;s cumulative solar open access capacity.
Solar open access projects in Rajasthan account for 4.4% of the large-scale installations and 19% of the large-scale capacity additions in CY 2023.
In 2023, the state&#8217;s main off-takers of open access power were the petroleum and gas, bioenergy, IT, and other C&amp;I industries.
Rajasthan&#8217;s solar open access installations have been slow over the years due to high surcharges and difficulties executing projects. Stakeholders have witnessed a lag from DISCOMs in approving captive projects, with demands of increasing the equity shareholding to 100% instead of the standard 26%.
Rajasthan has one of the country&#8217;s largest solar open access solar project pipelines, but most of these projects have been unable to obtain DISCOM approvals, stalling development in the segment.
Mercom recently <a href="https://www.mercomindia.com/rajasthan-struggles-open-access-projects-face-setbacks">reported</a> on the state&#8217;s challenges in harnessing its full solar open access potential.
Recently, the <a href="https://powermin.gov.in/" target="_blank" rel="noopener">Ministry of Power</a> <a href="https://www.mercomindia.com/submit-green-open-access-compliance-status" target="_blank" rel="noopener">instructed</a> state electricity regulatory commissions (SERCs) to comply with the Electricity (Promoting Renewable Energy through Green Energy Open Access) Rules and align their states&#8217; Open Access Regulations with the notified rules and all the amendments.
The &#8220;Q4 2023 Mercom India Solar Open Access Market Report&#8221; report is 85 pages long and covers vital information and data on the market. For the complete report, visit: <a href="https://www.mercomindia.com/product/q4-2023-mercom-india-solar-open-access-market-report" target="_blank" rel="noopener">https://www.mercomindia.com/product/q4-2023-mercom-india-solar-open-access-market-report.</a>

Top 5 States for Solar Open Access Installations in CY 2023

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					</table>India installed 2.8 GW of new wind energy capacity in 2023, a ~56% surge from 1.8 GW in 2022. The cumulative wind capacity as of December 2023 stood at 44.7 GW, compared to 41.9 GW at the end of 2022.
In the fourth quarter (Q4) of 2023, India added 552 MW of wind power capacity, representing a 141% year-over-year (YoY) increase, according to <a href="https://www.mercomindia.com/research" target="_blank" rel="noopener">Mercom India Research</a>. Installations in Q4 surged by 34% quarter-over-quarter.
The Ministry of New and Renewable Energy (MNRE) has included wind power in the Renewable Power Purchase Obligation (RPO) trajectory, with an eye on driving wind installations higher.
The increased demand for round-the-clock renewable energy has led to a rise in wind-solar hybrid projects across the country.
In Q4 2023, Gujarat and Tamil Nadu witnessed considerable growth in solar-wind hybrid renewable energy projects due to favorable policies and easier access to land as compared to other states in the country.
Apart from utility-scale installations, group captive hybrid power projects are also gaining pace in these states due to C&amp;I consumers&#8217; interest in procuring green power for longer durations.
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<img loading="lazy" decoding="async" class="aligncenter wp-image-64292 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103354.png" alt="India Wind Power Installations by Year" width="750" height="499" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103354.png 750w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103354-300x200.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103354-650x432.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103354-624x415.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103354-600x399.png 600w" sizes="(max-width: 750px) 100vw, 750px" />
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Notable projects commissioned during the quarter were <a href="https://continuumenergy.in/" target="_blank" rel="noopener">Continuum</a>&#8216;s 67.5 MW wind-solar hybrid project in Tamil Nadu, JSW Renew Energy&#8217;s 51 MW of the Solar Energy Corporation of India&#8217;s (<a href="https://www.seci.co.in/" target="_blank" rel="noopener">SECI</a>) Tranche IX project in Tamil Nadu, and <a href="https://ntpcrel.co.in/" target="_blank" rel="noopener">NTPC Renewable Energy</a>&#8216;s 50 MW of Phase-I Dayapar Wind Energy Project in Gujarat.
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<img loading="lazy" decoding="async" class="aligncenter wp-image-64293 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103117.png" alt="India Cumulative Wind Installations by State" width="730" height="487" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103117.png 730w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103117-300x200.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103117-650x434.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103117-624x416.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2024/03/Screenshot-2024-03-13-103117-600x400.png 600w" sizes="(max-width: 730px) 100vw, 730px" />
Gujarat led the states for cumulative wind installations, accounting for 25.1% of the country&#8217;s total capacity. Tamil Nadu came next with 23.3%.
At the end of Q4, Karnataka had the third highest installations, representing 12.5% of the total wind capacity, and Rajasthan ranked fourth with 11.6%.
Maharashtra was fifth, accounting for 11.5% of the installed wind capacity during the quarter, followed by Andhra Pradesh (9.2%) and Madhya Pradesh (6.4%).
In December 2023, MNRE <a href="https://www.mercomindia.com/mnre-unveils-revised-wind-power-projects" target="_blank" rel="noopener">revised</a> its 2016 policy for repowering wind power projects to facilitate the replacement of older turbines.
Around the same time, the Ministry of External Affairs also <a href="https://www.mercomindia.com/rules-leasing-offshore-wind-sites" target="_blank" rel="noopener">issued</a> the Offshore Wind Energy Lease Rules 2023, notifying that leased areas for offshore wind energy projects will be valid for an initial three-year period for conducting resource measurements and surveys.
In a bid to harness the potential of offshore wind energy, Finance Minister Nirmala Sitharaman, in her Budget 2024 speech, <a href="https://www.mercomindia.com/budget-2024-free-electricity-rooftop-solar-vgf-offshore-wind" target="_blank" rel="noopener">announced</a> viability gap funding for offshore wind projects with a cumulative capacity of 1 GW. This financial support is expected to propel the development of offshore wind projects, contributing to India&#8217;s renewable energy goals.
Recently, SECI, on behalf of the National Institute of Wind Energy, <a href="https://www.mercomindia.com/seci-invites-offshore-wind-projects-in-tamil-nadu" target="_blank" rel="noopener">invited</a> bids for the allocation of sea-bed lease rights for 4 GW offshore wind power projects on a build-own-operate basis.

India Registers 56% Growth in Wind Installations, Adds 2.8 GW in 2023

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					</table>Favorable geography and climate combined with a proactive government catapulted Gujarat to the top position among states for open access solar in the second quarter (Q2) of 2023. Consumers, especially those in the C&amp;I segment, are happy with the savings on their power bills, thanks to open access solar.
Gujarat has just notified the Renewable Energy Policy 2023 with an ambitious goal of developing 100 GW of renewable energy capacity by 2030. This is expected to further enhance Gujarat&#8217;s reputation as one of the leading states for renewable energy generation. Gujarat has also formulated one of the best hybrid energy policies in India.
In Q2 of 2023, Gujarat saw a surge in open access solar power capacity, adding over 330 MW, a sixfold growth compared to the previous quarter. Gujarat ranked fourth in the country in terms of total open access solar power capacity as of June 2023. Of this, more than 42% was installed in Q2 alone.
Solar open access installations in the country grew by 24% in Q2 compared to the previous quarter, adding 712 MW of capacity, according to the <a href="https://www.mercomindia.com/product/q2-2023-mercom-india-solar-open-access-market-report" target="_blank" rel="noopener">Q2 2023 Solar Open Access Market Report</a> by Mercom India Research.
In Gujarat, captive wind-solar hybrid power projects accounted for 86.6% of the capacity added during the quarter.
In June, the Gujarat Electricity Regulatory Commission (<a href="https://gercin.org/" target="_blank" rel="noopener">GERC</a>) <a href="https://www.mercomindia.com/gujarat-green-energy-open-access-regulations" target="_blank" rel="noopener">issued</a> the draft regulations for green energy open access, including rules for energy banking and other open access charges applicable to consumers.
The most common business models for green energy open access in the state are captive and group captive. Several industries, such as power, textiles, chemicals, jewelry, and iron and steel, have set up captive renewable projects in the state during the quarter.
<a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Gujarat-estimated-savings.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-58939 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Gujarat-estimated-savings.png" alt="Gujarat estimated savings" width="637" height="422" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Gujarat-estimated-savings.png 637w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Gujarat-estimated-savings-300x199.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Gujarat-estimated-savings-624x413.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/09/Gujarat-estimated-savings-600x397.png 600w" sizes="(max-width: 637px) 100vw, 637px" /></a>
For commercial and industrial (C&amp;I) consumers with billing demand of more than 2,500 kVA opting for captive solar open access, the savings is about ₹0.36 (~$0.004)/kWh. The savings on the energy charges could be as high as 8% over the existing bills.
Favorable Policies
Equity Requirement for Captive Projects
Renewable energy expert Santosh Yadav commented, &#8220;Captive project approvals previously were restricted as the state demanded 100% equity share, which has now improved under the Gujarat Hybrid Policy&#8221;.
Per the Gujarat Hybrid Policy 2018, for group captive projects, 100% of the equity is to be invested by the captive users cumulatively. They are required to consume the entire power generated in the ratio of the equity amount invested with the variation in consumption not exceeding 10% annually.
According to the latest amendment in the Gujarat Hybrid Policy, consumers can set up new wind-solar hybrid power projects or add wind/solar capacity to their existing projects for captive use. This change will permit the consumers with 26% equity in the captive projects to get approval for open access.
Incentives
Rajni Bhandari from <a href="https://ampin.energy/" target="_blank" rel="noopener">AmpIn Energy</a> said, &#8220;The Gujarat government has been quite proactive in allowing the setting up of hybrid power projects. DISCOMs allow the C&amp;I customers to choose their suppliers and are supportive in granting approvals.&#8221;
Captive wind-solar hybrid power projects injecting power at 66 kV and drawing power at 11 kV voltage levels to the required locations within the state receive a 50% concession on the wheeling charges.
This significantly reduces the open access charges, and the net landed cost for procuring power from captive hybrid power projects.
Renewable energy expert Ramakrishnan V said, &#8220;If we set up a wind-solar hybrid power project in Gujarat, we don&#8217;t need to pay separate transmission charges for wind and solar. The higher the transmission charges between the two will apply. We have seen that many states levy transmission charges separately for solar and wind. Also, most of the wind locations were identified by the government, and there was a clear mandate by the DISCOMs on the locations to set up hybrid power projects.&#8221;
Energy banking
The energy banking for high tension (HT) consumers for solar projects is on a daily basis, while it is on a monthly basis for wind-solar hybrid power projects, providing greater flexibility in terms of time period for energy settlement.
The state has been favoring wind-solar hybrid power projects over standalone solar projects in its energy banking provisions.
Future Expectation &#8211; Contract Demand
Per the Gujarat Hybrid Policy, there is a contract demand cap for wind-solar hybrid power projects. For captive and third-party models, the power contracted from the hybrid power project is 50% of the sanctioned load of consumers for solar and wind, respectively. However, consumers may set up hybrid power projects to meet the renewable purchase obligation without a cap on the contracted demand/sanctioned load.
Ramakrishnan said, &#8220;We anticipate a new solar wind hybrid policy to be notified soon. We are waiting for the contract demand cap of 50% on the hybrid power projects to be removed. We are also anticipating a standalone wind policy in Gujarat.&#8221;

Author: Joydeep Sinha

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