KERC Issues Vital Directive on Wheeling Charges and Banking for Renewable Power Projects

The Karnataka Electricity Regulatory Commission (KERC) has taken a momentous step by issuing a noteworthy directive concerning wheeling charges and banking facilities for renewable power projects. This strategic move is in alignment with the KERC (Terms and Conditions for Open Access) Regulations of 2004, a comprehensive framework that encompasses vital components such as transmission charges, wheeling charges, and cross-subsidy surcharge.

The scope of this directive is of paramount importance. It applies to applications received for wheeling and banking activities from April 1, 2018, up to the date of applicability of the Grid Electricity Open Access (GEOA) Regulations. Specifically, it covers applications submitted before the nodal agency on or before January 13, 2023, for Short-Term Open Access (STOA), and before January 2, 2023, for Long-Term Open Access (LTOA).

In regard to the determination of transmission and wheeling charges for forthcoming Wheeling and Banking Arrangements (WBAs), the outcome of a pending case holds substantial significance. The Commission had previously established these charges at 25% of the standard rates. However, this decision was set aside by the Hon’ble High Court, and the matter now awaits resolution by the division bench of the Hon’ble High Court.

For non-Renewable Energy Certificate (REC) based projects that submitted applications for WBAs between April 1, 2018, and the GEOA Regulations’ applicability date, the KERC has made a resolute decision. The interim order dated September 7, 2021, which includes prevailing wheeling and banking charges, will continue to be in effect until the Division Bench of the Hon’ble High Court reaches a final verdict.

Similarly, with respect to the banking period and associated charges, the KERC’s stance hinges on an ongoing case. For non-REC based projects applying for WBAs within the aforementioned period, the Commission has determined that an annual banking facility and charges amounting to 2% of the injected energy will persist, subject to the final judgment of a case currently pending before the Hon’ble Supreme Court of India.

The KERC’s proactive measures underscore its commitment to optimizing the utilization of renewable energy sources and promoting sustainable practices in power generation and distribution.