The Government of Maharashtra has constituted a committee to examine the applicability of electricity duty on rooftop solar consumers, behind-the-meter systems, and grid support charges, amid rising adoption of distributed renewable energy in the state.

The decision comes as changing electricity consumption patterns driven by rooftop solar installations and captive generation prompt a reassessment of the existing duty framework under the Maharashtra Electricity Duty Act, 2016.

Electricity duty is currently levied on power consumption across all consumer categories and includes fixed charges, energy charges, fuel adjustment charges, and reliability charges. However, the growing adoption of rooftop solar and BTM systems has altered traditional consumption patterns, raising questions about how duty should be applied to self-generated and self-consumed electricity.

The development follows an order by the Maharashtra Electricity Regulatory Commission (MERC), which allowed the levy of grid support charges on rooftop solar systems with capacities above 10 kW. The state government has now initiated a policy-level review to determine whether electricity duty should also be applied on such charges.

The committee has been tasked with evaluating the applicability of the electricity duty across several dimensions. This includes examining whether duty should be levied on electricity consumed under self-consumption and net metering arrangements, as well as on electricity generated and consumed by rooftop solar users.

It will also assess the applicability of the electricity duty to grid support charges for rooftop solar consumers and the feasibility of transitioning from a fixed-rate to a percentage-based mechanism.

For behind-the-meter systems, including captive generation and storage-based setups, the committee will evaluate whether an electricity duty should be imposed on on-site electricity generation and consumption.

In addition to technical applicability, the committee will assess the broader financial and policy implications of any proposed changes. This includes analyzing the potential impact on state government revenue and the financial position of distribution companies.

The panel will also recommend possible exemptions and incentives for specific consumer categories while ensuring a balance between promoting renewable energy adoption and safeguarding revenue streams.

The committee has been given 10 days to submit its report.

The Maharashtra Electricity Regulatory Commission recently approved a generic tariff of ₹2.82 (~$0.030)/kWh for surplus rooftop solar power.

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