Uttar Pradesh Releases Blueprint for Open Access Regulations

The Forum of Regulators (FOR) released a report last December on the issues affecting open access in the country. The report charts a way forward for the better implementation of open access in India.

These recommendations are based on the report compiled by the Working Group and a consultative paper issued by the Ministry of Power.

FOR was formed in 2005 with the objective of harmonization of regulations in the power sector framed by the Central Electricity Regulatory Commission (CERC), State Electricity Regulatory Commissions (SERCs), and Joint Electricity Regulatory Commissions (JERCs).

In the 55th Meeting of FOR, issues affecting the implementation of open access were discussed and a working group was constituted to carry out the detailed examination of all the issues faced by the open access consumers in the country.

The working group has identified the tariff and non-tariff barriers for open access, the impact of open access on revenue of distribution companies (DISCOMs), carried out a detailed examination of the rules for captive generation, their impact on open access, and has also provided suitable measures for the implementation of open access.

There’s a need for uniform methodology for the determination of various charges such as open access charges, cross subsidy surcharge and additional surcharge, the report noted.

Key Recommendations

  • Leverage technology solutions and automate processes for issue of No-Objection Certificates (NOC), energy scheduling, and energy settlement.
  • Conduct impact assessment for DISCOMS as well as open access users.
  • Open access consumers must schedule minimum continuous eight hours of supply through open access.
  • Cross Subsidy Surcharge (CSS) must be calculated on the basis of average cost of supply and must not be based on category-wise or voltage-wise cost of supply.
  • There must be three components of additional surcharge to fully recover the losses due to stranded capacity and regulatory assets.
  • Tariff structure is not uniform across all SERCs and the concept of standby charge can be only for long-term open access consumers.
  • SERCs must revise fixed charges gradually.

Recently, Mercom reported that the Bihar Electricity Regulatory Commission (BERC) and Assam Electricity Regulatory Commission (AERC) issued draft regulations pertaining to open access for the year 2018.

We are also seeing states slowly make open access more cumbersome to avoid losing future revenues. Last year Telangana DISCOMs petitioned Telangana State Electricity Regulatory Commission for a surcharge of ₹1.95 (~$0.03)/kVAh on open access consumers for 2017-18.

Assam has also proposed draft rules which would require open access consumers to pay transmission and wheeling charges.