Haryana and Odisha accounted for just 0.4% of the solar open access installations in 9M 2024 and 1.1% in Q3 2024, according to Mercom’s Q3 2024 India Solar Open Access Market Report. However, certain regulatory and policy changes in the two states have made them attractive for solar open access.

India added 4.8 GW of solar open access capacity in the first nine months (9M) of 2024, up almost 69% compared to 2.8 GW installed in 9M 2023. The capacity added in the first nine months of 2024 surpassed annual installations witnessed in any of the previous years.

Solar open access installations in Q3 2024 totaled almost 1.1 GW, down by more than 36% quarter-over-quarter (QoQ) and a drop of over 6% year-over-year (YoY).

According to Mercom’s open access report, Odisha has an attractive pipeline of solar open access projects as of September 2024. However, the development pipeline in Haryana is still emerging, and the state only had a small capacity of projects under various stages of development at the end of Q3 2024.

Haryana

Haryana’s regulatory commission has reduced the cross-subsidy surcharge, transmission charges, and wheeling charges for the state’s commercial and industrial (C&I) consumers in the financial year 2024-25 (FY25) by 1.6%, 19.5%, and 29.1%, respectively, without raising electricity tariffs. These reductions are expected to enhance the appeal of both third-party and captive power projects within the state.

Additionally, the clarifications issued by the Haryana Electricity Regulatory Commission on reliability and other charges and regulatory provisions, including imbalance charges, wheeling and transmission charges for captive projects, energy banking provisions, injection and drawal of green energy, and issuance of renewable energy certificates are expected to streamline the development of solar open access projects in the coming quarters.

In Haryana, the DISCOMs’ non-streamlined and unclear approval process for captive verification, along with their contention that consumers must hold 100% equity in captive projects—despite no such requirement being specified in the notified regulations—has significantly hindered project development in the state.

Haryana is home to several energy-intensive industries, including steel, information technology (IT), chemicals, automotive, auto components, food and beverage, petroleum refining, packaging, rice and sugar mills, textiles, scientific instrument production, and pharmaceuticals. These industries have the potential to optimize electricity costs by adopting solar energy through captive open access projects.

Odisha

In its FY25 tariff order, Odisha’s regulatory commission reduced the cross-subsidy surcharge for HT consumers under TP Central Odisha Distribution Limited (TPCODL), TP Northern Odisha Distribution Limited (TPNODL), and TP Southern Odisha Distribution Limited (TPSODL) by 10.4%, 57.8%, and 4.4%, respectively.

Odisha’s Renewable Energy Policy provides several incentives for solar open access projects. The incentives include ₹0.50 (~$0.006)/kWh concession on electricity duty, 50% exemption of cross subsidy surcharge, and exemption of ₹0.20 (~$0.002)/kWh on state transmission utility (STU) charges for 15 years.

Odisha’s policy also provides a 25% reduction in wheeling charges for consuming energy from projects commissioned in the state for 15 years. For projects commissioned by March 31, 2026, the exemption on STU charges stated by the state’s policy will be for 20 years, i.e., for an additional five years.

The area under TP Western Odisha Distribution Limited (TPWODL), an industrial hub with industries such as steel, agrotech, mining, and others, holds significant potential for developing solar open access projects due to the energy-intensive operations of these industries.

Odisha has substantial potential for captive projects as distribution companies (DISCOMs) have been supportive in granting project approvals.

In Odisha, challenges such as land acquisition issues, low electricity tariffs for commercial and industrial (C&I) consumers, and limited consumer awareness have hindered capacity additions. Furthermore, consumers with captive thermal power projects are reluctant to adopt green energy open access due to the lower tariffs of their existing power purchase agreements.

A stricter implementation of renewable purchase obligations (RPOs) could incentivize these consumers to transition to solar open access, potentially driving a significant boost in installations.

Mercom’s solar open access tracker provides all vital project details for installed and pipeline captive, group captive, third-party, and projects under solar parks in the country.

The Q3 2024 Mercom India Solar Open Access Market Report is 59 pages long and covers state-wise open access charges, electricity tariffs, power purchase agreement (PPA) tariffs, installed and pipeline project capacities, and policy updates, along with other critical information and data on the market.