Industry Hails New Open Access Rules, Hopes For Turbocharged Solar Growth

Highlights :

  • A cross section of the solar industry has welcomed the new Green Open Access Rules, calling it a potential gamechanger.
  • With the rules applying nationally, they could remove one of the biggest bugbears to growth, statewise variations.

The notification of the Electricity (Promoting Renewable Energy through Green Open Access) Rules 2022 or the Green Open Access Rules as the industry is calling it, has easily been the biggest policy move for the sector this quarter. A quick perusal of the messages of welcome indicate that optimism rules high, and the Corporate and Industrial (C&I) sector could truly come onto its own with the new rules. We give below a few of the early responses to the new rules.

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Kushagra Nandan, Co-Founder and Managing Director, SunSource Energy:

“We welcome the Electricity (Promoting Renewable Energy through Green Open Access) Rules 2022 notified by the Government of India and feel that they are a shot in the arm for the green power demand in the C&I segment. The C&I segment accounts for about 50% of electricity consumption in India and the demand for green energy from this segment, especially from Open Access projects, has been growing rapidly in the last few years. By lowering the threshold for Open Access from the existing 1 MW to 100KW, the Government has opened up the door for this market to multiply multi-fold in the coming few years.

Rahul Gupta, Director, Rays Power Experts

The Green Energy Open Access Rules 2022 is a transformative Change for C&I businesses.

Rays Experts had anticipated this change. We launched the first-ever CTU connected 100% privately owned solar park in Bikaner with a capacity of 2000 MW well ahead of time.

This solar park shall provide end-to-end solutions to the C&I IPP developers with ready to move infrastructure to enable plant commissioning as early as mid- 2023. Once fully commissioned, It will be the largest solar park globally.
We have already booked 50% park capacity in just three months of the park’s launch. The substation construction, scheduled to be commissioned in Dec 2022, has already begun.

This park will allow even a 1 MW consumer in any part of the country to get power from a Solar power plant in western Rajasthan. It would be a game-changer, with IPPs being able to set up a single large solar plant taking care of multiple consumers in different states.

Top left, Vinay Pabba, Top right- Rahul Gupta, Bottom left Kushagra Nandan, Bottom Right Shravan Sampath

Shravan Sampath, Founder, CEO, Oakridge Energy

Importantly, the framework of charges has also been notified. Every state was imposing their own set of charges and this was making business difficult.

Pros – All in all, a great boost to renewable C&I in India. A national framework and a central nodal agency would go a long way in giving comfort to investors.

Cons – electricity in India is a concurrent subject (both the center and the state have a joint jurisdiction in framing regulations). These rules have been issued under the dodgy section-176 of the electricity Act, and it’s very legal premise may be questionable. Importantly, states resist facilitating C&I open access since they lose their paying customers. They will fight this tooth and nail. Let’s see what the courts say, and how soon legal clarity is obtained.

Every transformational initiative begins with a single step. The Govt of India has taken the first step. There is no way to go from here but up.

Vinay Pabba, COO Vibrant Energy

If implemented in letter and spirit, this is a formidable piece of reform. It yanks up OA demand, will deepen the power markets and and is a shot in the arm for green power and weans green power growth away from a dependency on utility oriented reverse auctions.

Even industry bodies like the Cellular Operators Association of India, have welcomed the move. “COAI raised concerns that the important limitation in the OA policies – that the buyer must have a minimum ‘Connected Load’ typically 1MW, which is being followed by most states. From a telecom perspective, since each tower has an independent electricity connection and consumes about 3 to 5KW, which is much less than 1MW, our member TSPs are unable to make use of renewable sources effectively due to this regulatory bottleneck. Although on an aggregate level, tower sites put together consume much higher. From a practical standpoint, considering the distribution and spread of mobile towers and limited open area available at the tower site, an on-site solar net metering solution has practical limitations w.r.t. deployment. Hence to deploy renewables at a bigger scale, our member TSPs need renewable energy solutions that can only be provided through Open Access”, said Lt. Gen. Dr SP Kochhar, Director General, COAI.

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