Commercial and industrial (C&I) consumers benefit significantly from sourcing renewable energy through open access arrangements. In addition to an assurance of reliable power supply and savings on energy costs, they can also make their operations more sustainable and reduce their carbon footprint.

The Ministry of New and Renewable Energy‘s green energy open access regulations have significantly boosted India’s solar open access market. In the first quarter of 2024 alone, India achieved 1.8 GW of solar open access capacity, marking a 152% year-over-year increase in installations, according to the Q1 2024 Mercom India Solar Open Access Market Report.

At Mercom India’s recent C&I Clean Energy Meet in Coimbatore, Santhosh T, Senior Manager-BD, Sunsure, highlighted three key aspects that C&I consumers must consider before opting for solar open access: regulatory alignment, business needs, and a streamlined process facilitated by a renewable energy developer.

Since open access is heavily regulated, consumers must ensure they meet the eligibility criteria in terms of capacity. Consumers are eligible for open access if they have a capacity of 1 MW and above. However, with the introduction of green energy open access regulations, this minimum requirement has been reduced from 1 MW to 100 kW.

Santhosh referred to additional considerations, such as the prerequisites set by the Tamil Nadu Electricity Regulatory Commission, the need for an availability-based tariff (ABT) meter, and connections to Tamil Nadu Generation and Distribution Corporation (TANGEDCO) and Tamil Nadu Transmission Corporation (TANTRANSCO). Moreover, verifying whether any ongoing judicial proceedings might affect the process is important.

Businesses must understand their energy needs. While rooftop solar typically displaces 15%- 20% of an industrial unit’s consumption, open access can cover 20-60%, depending on the state. In Tamil Nadu, this can extend up to 60%.

Companies must navigate open access regulations, manage the request for proposal (RfP) process, and structure long-term contracts that may last up to 25 years.

Santhosh pointed out that the market potential for C&I open access over the next eight years is projected to reach 80 GW. This represents a significant opportunity for developers, whether through inter-state or intra-state connections, though managing supply constraints remains a challenge.

Addressing the advancements in Battery Energy Storage Systems (BESS), Jefry Sahayam, BDM – South India (DG), Jinko Solar emphasized the importance of enhancing the productivity of existing systems. He noted that batteries have become a cost-effective alternative to diesel generators, offering consumers a reasonable return on investment. “With a payback period now reduced to 7-8 years, the challenge remains the 25% peak charges. BESS will become even more viable as prices continue to fall, attracting increased investment.”

For industries such as data centers, where minimizing power disruptions is critical, Sahayam highlighted the adoption of lithium ferro-phosphate (LFP) batteries in solar systems with BESS. These batteries help ensure a smooth transition during power cuts. He also mentioned that industries are increasingly shifting from diesel generators to BESS to reduce carbon emissions.

BESS installation costs have dropped significantly this year. Manufacturers are optimistic that further price reductions will attract more customers as the payback period is shortened.

The next Mercom India C&I Clean Energy Meet event will be held in Pune on September 20, 2024. You can register here.

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