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A captive renewable energy plant must adhere to all banking requirements, including signing a wheeling and banking agreement with the distribution licensee, according to a recent decision by the Rajasthan Electricity Regulatory Commission (RERC).
Shree Cement has submitted a petition to get rid of banking-related issues with the RERC renewable energy price regulations.
The RERC (Terms and Conditions for Tariff Determination from Renewable Energy Sources) Regulations, 2020, did not include the request to evaluate all energy for banking, even though it had not been injected into the grid.
Shree Cements has a contract demand of 9 MVA and plans to develop a co-located captive solar plant at its Jobner facility in Rajasthan. It argued that a captive co-located solar power installation with a capacity equal to 100% of the contracted demand was eligible for banking.
However, Jaipur Vidyut Vitran Nigam (JVVNL) refused to offer the project a financing facility since captive solar plants that are installed behind meters are not eligible for it. It claims that the petitioner’s captive generating project, which would be delivering power to the cement mill, would not be directly connected to the grid.
The distribution company (DISCOM) further stated that if the project was greater than 1 MW without open access, the petitioner would not be able to supply power into the system. As a result, the generator was unable to make any claims for clarification alleviation under the renewable energy standards while it was not pushing for open access.
The DISCOM added that the laws called for a captive renewable energy plant to supply the system with all of its energy, whether it is co-located or situated outside.
Further, such a customer will be required to sign a banking and wheeling contract. Seeking a new way to input energy into the grid by eliminating obstacles amounted to an abuse of the legal system.
The Commission noted that the project being erected and co-located behind the meter was protected by laws governing renewable energy.
According to the conditions outlined in the banking provisions, the state Commission noted that no banking facility could be permitted for renewable energy projects that supply power to a third party under open access or for consumption from projects installed behind the meter without a bi-directional meter in the same premises.
The Commission said that in order to use the banking facility, a captive renewable energy project must comply with all the terms and conditions of banking outlined in the wheeling and banking agreement with the distribution licensee, whether it is co-located behind the meter or not.