The Maharashtra Electricity Regulatory Commission (MERC) has directed the Maharashtra State Electricity Distribution Company (MSEDCL) not to levy wheeling charges and losses on solar open access consumers not using the distribution company’s distribution system or end-to-end dedicated transmission lines.

It said MSEDCL must adjust the wheeling losses in the solar project developers’ next billing cycle.

Background

The petitioners, comprising three solar open access consumers, Saarloha Advanced, CIE Automotive India, and Mahindra and Mahindra, procured 15 MW, 20 MW, and 43 MW, respectively, from ReNew’s 50 MW, 100 MW, and 50 MW solar parks.

MSEDCL had imposed wheeling charges and losses on the petitioners despite distributing power through ReNew’s power evacuation infrastructure.

The petitioners requested the Commission to set aside the impugned invoices involving wheeling charges and losses and declare that MSEDCL is not entitled to levy wheeling charges and losses for power transmission on any future project governed by the same arrangement.

MSEDCL argued that it provided several services, such as auxiliary power supply, energy metering of such auxiliary power, and banking facility, which are associated facilities of the distribution company’s (DISCOM) transmission system.

The petitioners had also requested the Commission to instruct MSEDCL to refund the wheeling charges and provide credit for wheeling losses with 18% interest. The Commission had approved this plea at an earlier hearing.

MSEDCL had earlier refunded ₹ 36.25 million (~$419,165) to Saarloha Advanced Materials, ₹67.41 million (~$779,388) to CIE Automotive India, and ₹ 164.5 million (~$1.9 million) to Mahindra and Mahindra.

It had also imposed a penalty of ₹100,000 (~$1,162) on MSEDCL for repeatedly and unduly charging wheeling charges and losses.

Commission’s Analysis

The Commission observed that dedicated transmission lines or systems are not part of DISCOMs’ distribution network. It also noted that wheeling charges must only be paid by consumers or generators directly connected to a DISCOM-maintained transmission system or with point-to-point dedicated transmission lines.

It rejected MSEDCL’s contention that the 33 kV line is part of its distribution system and that petitioners are entitled to a banking dispensation. It also noted that wheeling charges are only payable when the distribution system is used, which was not true for MSEDCL’s 33 kV distribution system.

The Commission ruled that MSEDCL cannot levy wheeling charges and losses for power procured through open access and directed it to refund the petitioners’ wheeling charges and the applicable interest within one month.

It also asked MSEDCL to adjust the units deducted toward wheeling losses against the petitioners’ next billing cycle.

In February 2024, MERC directed MSEDCL to refund the energy wheeling charges to three solar developers, holding that there was no merit in MSEDCL’s claim that the 33 kV line was part of its distribution system.

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