Kerala May Allow Higher Feed-In Tariff For Prosumers With ESS

The Kerala State Electricity Regulatory Commission (KSERC) has proposed higher feed-in tariffs for prosumers who install energy storage systems (ESS) alongside renewable energy (RE) systems, according to its draft “Renewable Energy and Related Matters Regulations, 2025.”

The tariffs would apply to energy injected into the grid during peak hours and be determined by the Commission.

Energy storage provisions

The draft allows groups of government offices or local self-government institutions (LSGIs), including those under government schemes, to set up decentralised renewable energy (DRE) plants in LSGI areas. These plants must include ESS with a capacity of at least 20% of the DRE plant’s generation potential.

If a hybrid inverter is installed with storage of at least 30% of the plant’s generation capacity, the total DRE plant capacity may exceed regulatory limits. In such cases, the prosumer must bear the cost of upgrading the distribution infrastructure.

The draft also sets renewable purchase obligations (RPO) and technical standards for ESS, including for grid-scale standalone battery energy storage systems (BESS), which must maintain a minimum annual availability of 95% and a maximum degradation rate of 2.5%.

Gross metering and virtual net metering

The draft allows all consumers and prosumers to opt for a gross metering system (GMS), provided the DRE plant is not located on the consumer’s premises. Under this arrangement, separate connectivity can be obtained for systems between 1 kW and 3 MW in capacity.

Under the virtual net metering (VNM) framework, domestic consumers in multi-storey buildings or residential complexes may install DRE plants with ESS covering at least 30% of the plant’s generation potential. The VNM provision also extends to common areas or residents’ associations.

The minimum plant capacity under VNM is 10 kW. The maximum is linked to the aggregate connected load or contract demand of all participants, with individual residential shares capped at 5 kW, excluding common connections.

Peer-to-peer trading

The draft regulations also propose enabling peer-to-peer (P2P) energy trading for prosumers. They would be allowed to trade surplus renewable energy, without availing banking, via an online platform using blockchain or other technologies approved by the Commission.