The Telangana Electricity Regulatory Commission (TGERC) has issued a detailed draft procedure for verifying the captive status of power generating plants and their users in Telangana.

The initiative is part of the regulatory framework under the Electricity Act of 2003 and aligns with the “Terms and Conditions of Open Access” Regulation, 2024.

The draft aims to ensure compliance with the statutory requirements for captive power generation, offering a structured approach to verification.

TGERC is inviting objections and suggestions from stakeholderswith a submission deadline of September 21, 2024. The process is intended to refine the draft procedure and ensure it adequately addresses the needs of all involved parties.

It applies to all power projects and users claiming captive status based o criteria related to electricity consumption and equity shareholding. Distribution licensees are required to submit an annual consolidated report to TGERC, based on data provided by CGPs and their users, by June 30 each year.

A CGP is a power project et up primarily for the owner’s use, requiring at least 26% ownership by captive users and consumption of at least 51% of the electricity generated.

This regulation facilitates non-discriminatory access to transmission and distribution networks for generating plants.

Captive users must hold a minimum of 26% of the ownership with voting rights and consume at least 51% of the electricity generated annually.

The verification process involves several critical steps:

• CGPs must submit applications and required documents to the distribution licensee by June 30 each year. This includes details on electricity generation, user consumption, and equity shareholding.
• They are tasked with collecting and analyzing data from CGPs and submitting a consolidated report to TGERC.
• The Commission will verify the captive status based on these reports and may request further information from CGPs or users if necessary.

The procedure includes conditions to ensure compliance with the Open Access Regulations:

• Electricity consumption by captive users can occur directly or through energy storage systems.
• Any changes in ownership structure must be reported with supporting documentation.
• If the CGP is owned by a company formed as a special purpose vehicle with multiple generating units, the captive users must collectively hold at least 26% of the proportionate paid-up equity share capital with voting rights. Theyd must also consume at least 51% of the energy generated. The identification for captive use should be based on individual generating units rather than the entire generating station or company.
• CGPs that fail to meet the criteria will lose their captive status, and users will forfeit any concessions.
• If a CGP is owned by a co-operative society, then the members of that society must collectively hold at least 26% of the ownership with voting rights and consume at least 51% of the electricity generated annually for captive use.

The draft procedure provides comprehensive guidelines for verifying both ownership and consumption criteria:

• Requires documentation such as certificates from Chartered Accountants, Articles of Association, and shareholder details.
• Involves assessing the actual energy generated and consumed, including adjustments for technical losses in the network.

Each unit of the CGP must be equipped with a separate interface meter that includes real-time communication capabilities with the Regional Load Dispatch Center and/or State Load Dispatch Center , according to the specifications set forth in the Central Electricity Authority (Installation and Operation of Meters) Regulations, 2006, as updated periodically.

Mercom earlier reported that at a time when solar open-access installations are gaining traction across the country, developers with small-capacity projects in Telangana say the inordinate delay in adhering to regulatory frameworks by distribution companies (DISCOMs) is creating bottlenecks.

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