RERC Approves Parallel Operation Charges For Captive Power Consumers In Rajasthan, Effective FY 2025-26

The Rajasthan Electricity Regulatory Commission (RERC) in Jaipur has issued a significant order regarding the levy of Parallel Operation Charges (POC) on captive power consumers within the state. This decision, dated October 3, 2025, follows a petition filed by Jaipur Vidyut Vitran Nigam Ltd. (JVVNL) on behalf of all three state Discoms, including Ajmer Vidyut Vitran Nigam Ltd. (AVVNL) and Jodhpur Vidyut Vitran Nigam Ltd. (JdVVNL). The petition specifically sought approval for the imposition of these charges for the Financial Year 2024-25. The order was passed by the Coram comprising Chairman Dr. Rajesh Sharma and Member Shri Hemant Kumar Jain, who examined the petition and issued the final directives.

In its order, the Commission approved defined rates for the Parallel Operation Charges, taking into account the type of captive power plants (CPPs). Conventional CPPs will be charged ₹27.237 per KVA per month, calculated based on the installed capacity of the plant. Renewable energy-based CPPs will face a significantly lower rate of ₹11.90 per KVA per month. Hybrid plants, which combine conventional and renewable energy sources, will be levied POC charges by applying both rates proportionally according to the conventional and renewable share of their installed capacity. These rates are designed to reflect the cost and nature of the energy generated by the respective plants, ensuring a fair approach for all types of captive power generation.

The Commission also clarified several exclusions and limitations regarding the applicability of POC. Rooftop solar plants operating under net metering or gross metering arrangements are completely exempt from these charges. Additionally, POC will be levied only on power consumed by on-site or co-located loads, meaning that off-site captive power plants are not subject to these charges. The charge will also be calculated based on the net capacity of the generators, defined as the total installed capacity minus any open access capacity. In cases of co-located plants, POC charges will apply irrespective of the formal captive status of the plant, but only for the capacity used to serve the co-located load. Capacity already covered by Power Purchase Agreements (PPAs) between Discoms and any CPPs will also be excluded from the levy.

The order further directs the Discoms to report the total revenue generated from the application of these Parallel Operation Charges in their future Annual Revenue Requirement (ARR) or true-up petitions for review and formal consideration by the Commission. The implementation timeline was also clearly defined. Since the Financial Year 2024-25 had already concluded and the proposal was included in the ARR and tariff order for the following year, the charges will not be applied retrospectively. Instead, the POC will be applicable prospectively, taking effect as approved in the ARR and Tariff Order for FY 2025-26.

With this order, the RERC has provided clear guidelines for the calculation, application, and exemptions of Parallel Operation Charges for captive power consumers in Rajasthan. The Commission has ensured that charges are differentiated based on the type of power plant, while also safeguarding renewable energy and rooftop solar initiatives from additional financial burden. By defining both the rates and the scope of applicability, as well as mandating revenue reporting, the RERC has established a structured approach to POC implementation, balancing regulatory oversight with the interests of both the Discoms and the consumers. This order marks a key step in formalizing captive power regulations in the state and ensures that the process is transparent, fair, and aligned with current energy policies.