The Karnataka Electricity Regulatory Commission (KERC) has issued draft guidelines for implementing rooftop aero turbines with or without solar.

RAT is a small-scale wind energy project installed on rooftops to generate electricity by harnessing wind power. The turbines are designed to operate in urban or suburban environments where wind speeds are typically lower and more turbulent than in open areas.

The draft is titled ‘KERC (Implementation of rooftop aero turbine with solar or without solar) Regulations, 2024.

RAT with solar will be included in the Karnataka Renewable Energy Policy 2022-27.

Applicability

The distribution licensee must provide gross metering or net metering arrangements to the eligible consumers in its area of supply. To be eligible, the consumers will install the grid-connected RAT projects with solar or without solar of the installed capacity, and the distribution licensee will also provide interconnection with the distribution network.

Consumers intending to install RAT projects with solar will be allowed to install a capacity of not less than 1 kW. The installed capacity of one resource must not exceed the sanctioned load of the installation, and the other must not exceed 25% of the installed capacity. The total installed capacity should not exceed 1.25 times the sanctioned load.

For a RAT project without solar, the installed capacity must be at least 1 kW and must not exceed the sanctioned load installation.

The distribution licensee must allow the installation of grid-connected RAT projects whose cumulative capacity does not exceed the state’s total capacity.

Implementation Procedure

The distribution licensee will issue the approval after the field report and technical feasibility for RAT applications with or without solar. Further, the consumer can enter into power purchase agreements (PPA) with the distribution licensee. In some cases, consumers may require the Commission’s approval.

The eligible consumer can commission the RAT project with or without solar within 180 days of the PPA’s approval. The tariff for electricity supplied will be determined by the lowest tariff between the tariff approved by the Commission on the date of commissioning or 90% of the agreed PPA tariff.

Distribution licensees must monitor the installation process and submit quarterly reports to the Commission.

The Commission will approve the tariff for PPAs within control periods.

Tariff Determination

The capacity utilization factor (CUF) for solar projects will be 19%, and CUF for aero turbines will be calculated as the ratio of the actual energy produced by the turbine over a period of time to the maximum possible energy it could have produced if operated at full capacity.

The tariff will consist of operation and maintenance expenses, depreciation, interest on loan capital, interest on working capital, and return on equity.

The tariff period will depend on the project’s lifecycle, i.e., 25 years or any other period the Commission decides. The Commission will determine the levelized tariff, and the discount factor equivalent to the post-tax weighted average cost of capital will be considered.

The capital cost will include the cost of capital works up to the interconnection point.

The generic tariff will be determined at a debt-equity ratio of 70:30.

The loan tenure must be at least 13 years to recover 70% of the capital cost. The normative interest will be calculated using the RBI base rate plus additional basis points by the Commission.

Depreciation will be allowed up to 90% of the asset’s capital cost, and the asset’s salvage value will be considered 10% of the capital cost. If the debt component is 70% of the capital cost, the depreciation rate for the first 13 years will be 5.83% per annum. Otherwise, the depreciation will depend on the debt component and tenure of the loan. The remaining depreciation will be spread over the balance of the project’s useful life.

The equity’s value base will be 30% of the capital cost, and the normative return on equity will be 14% per annum for the tariff period.

The working capital will consist of one month’s operation and maintenance expenses and receivables equivalent to two months’ energy charges for sale. The interest on working capital will be the RBI base rate plus additional basis points divided by the Commission.

Operation and maintenance expenses will be 1% of the capital costs. The normative O&M expenses can be escalated at 5.72% per annum over the tariff period for the first year of the control period.

Connectivity

The RAT project, with or without solar, will be connected to the distribution network of the connectivity specified below:

The connectivity norms apply to all RAT projects, with and without solar, seeking connectivity with the distribution licensee’s network. Extra High Tension/ High Tension consumers may install solar power generators with low tension/high tension voltage and connect them to their low tension/high tension system.

In the case of gross metering, an exclusive line will be provided, and the consumer will cover the cost of the distribution network up to the interconnection point.

A RAT project of less than 150 kW capacity will be connected to the existing distribution transformer. However, the total capacity of the existing and proposed RAT projects on that distribution must not exceed 80% of the rated capacity. Projects above 150 kW will be connected to the 11 kV distribution system. The total capacity of the existing and proposed RAT projects must not exceed 80% of the line’s current carrying capacity.

The RAT project must have installed a facility to limit harmonics and other distortions before injecting energy into the grid, anti-islanding protection, and an automatic synchronization device.

The safety of the RAT system up to the interconnection point will be the consumer’s responsibility, and anything beyond that would rest with the distribution licensee. The system must be designed to safeguard the distribution system in the event of failure of its devices.

The consumer will be responsible for any accident caused by back-feeding from the RAT system when the supply from the distribution network is switched off. In such exigencies, the distribution licensee may disconnect the RAT system and ask the consumer to provide a manually operating isolating switch between the RAT system and the distribution system.

The consumer must not have any other source of supply, and the consumer will be responsible for taking measures to prevent battery power/diesel generator power/ backup power from extending to the distribution network on the failure of the distribution licensee’s grid supply.

Metering

Consumers eligible for gross metering can install a bi-directional meter at the interconnection point.

For consumers eligible for net metering, the existing consumer meter will be replaced with a bidirectional meter. The cost of the new meter will be borne by the  consumer, and the distribution licensee will install it.

The RAT meters will have features for recording time-of-day consumption/generation in net metering covered under the time-of-day tariff.

Billing

In the case of gross metering, the licensee will show the quantum of electricity exported and energy imported. The tariff for the imported energy will be determined by the highest tariff between the tariff agreed in the PPA and the prevailing retail supply tariff.

In net metering, the licensee will show the quantum of electricity injected and supplied by the consumer and the net electricity billed for payment.

If the electricity generated exceeds the electricity consumed, the excess electricity injected will be at the agreed PPA tariff.

If the electricity supplied exceeds what the consumer generates, the licensee will raise the bill for net electricity consumption at the tariff applicable to a consumer.

PPA

Consumers with an existing PPA for their solar projects must enter into a new PPA for 25 years.

RAT projects with installed capacity up to and including 1000 kW will be deemed to have been approved by the Commission on the date of execution by the parties.

If the RAT project is above 1,000 kW, the licensee will seek the Commission’s approval within seven days of signing the PPA.

In August 2024, KERC introduced the KERC (Implementation of peer-to-peer Solar Energy Transaction) Regulations, 2024 to promote renewable energy and innovative technologies.

Recently, the Commission issued draft regulations to balance power generation and consumption and minimize deviations from scheduled generation and consumption patterns.