The Uttar Pradesh Energy Regulatory Commission (UPERC) has reviewed its regulations for captive and renewable energy generating projects (CRE Regulations, 2019) in response to a petition from the Uttar Pradesh Power Corporation Limited (UPPCL).
The UPPCL had filed an instant petition seeking the inclusion of specific provisions and amendments in the existing CRE Regulations.
General Power to Amend:
The UPPCL noted that the ‘general power to amend’ clause was not incorporated as provided in earlier regulations. This clause provides the Commission the power to issue, amend, vary or rescind notifications, orders, rules, or bylaws.
To this, the Commission stated that there was no requirement for such a clause and cited the inherent powers of the Commission’s ‘power to amend’ clauses in the regulations, which gives it the same powers.
Banking and withdrawal of banked power:
The UPPCL explained that existing power banking and withdrawal provisions that allow power banked in one quarter to be withdrawn in the two subsequent quarters could severely affect its power purchase cost.
In response to this, the UPERC stated that until UPPCL provides evidence of any adverse impact on its power procurement cost, it would retain the present provision.
Tariff for other renewable energy sources:
The distribution company (DISCOM) also pointed out that according to regulations, the tariff for other renewable energy-based projects (primarily industrial waste) to supply electricity during the period of synchronization and commissioning of the unit was set at 50%. It noted that the tariff for other renewable energy sources was not specified and sought for the Commission to provide a rate.
The Commission, in response, noted that per the existing provisions, the tariff for other renewable sources would be decided on a case to case basis under such terms and conditions as stipulated under the relevant orders of the Commission.
It explained, citing a previous order, that since there was no existing benchmark for capital costs and operational norms for newer renewable energy sources, it would not be possible to decide the tariffs without the same.
The UPERC declared that it would continue to determine tariffs on a case-to-case basis for renewable energy generators and where the average power purchase cost (APPC) cannot be applied.
Declaration of the captive status of the project:
The UPPCL also sought for the Commission to exclusively maintain the onus of deciding whether or not a project meets the criteria of a ‘captive’ power project. The Commission, in response, asked the DISCOM to explain to it the methodology used to declare a project ‘captive.’
The UPPCL was unable to provide a satisfactory response and sought time from the Commission to come back with an answer and subsequently did not want to pursue this request.
Tariff for bagasse plant commissioned before 2005-06:
The UPPCL noted that tariffs for bagasse-based plants commissioned before the financial year (FY) 2005-06 was missing from the regulations and appealed to the Commission to make provisions for the same. In response, the Commission said it decided to allow these projects to adopt the same tariffs as projects commissioned in FY 2005-06.
Recently, Mercom reported that the Uttar Pradesh Electricity Regulatory Commission shed light on what qualifies to be a captive generation project and when they can withdraw banked energy.
In April last year, UPERC had issued new regulations titled “Captive and Renewable Energy Generating Plants (CRE) Regulations, 2019.” These regulations are applicable for captive generation, renewable sources of generation, and co-generation. In the case of captive generation projects, these regulations are applicable for all existing captive generating projects as well as proposed captive generating projects with an installed capacity of 1 MW or above irrespective of their connectivity with the grid.
Previously, the state issued draft regulations for forecasting, scheduling, and deviation settlement of solar and wind projects.
Nithin is a staff reporter at Mercom India. Previously with Reuters News, he has covered oil, metals and agricultural commodity markets across global markets. He has also covered refinery and pipeline explosions, oil and gas leaks, Atlantic region hurricane developments, and other natural disasters. Nithin holds a Masters Degree in Applied Economics from Christ University, Bangalore and a Bachelor’s Degree in Commerce from Loyola College, Chennai.