RERC Finalizes Parallel Operation Charges For Captive Power Plants Across Rajasthan

The Rajasthan Electricity Regulatory Commission (RERC) in Jaipur has issued a detailed order determining the Parallel Operation Charges (POC) that will apply to captive consumers across the state. The order, dated October 3, 2025, concludes an important petition filed by the three state distribution companies — Jaipur Vidyut Vitran Nigam Limited (JVVNL), Ajmer Vidyut Vitran Nigam Limited (AVVNL), and Jodhpur Vidyut Vitran Nigam Limited (JdVVNL). These Discoms had approached the Commission under Regulation 93 of the RERC Tariff Regulations, requesting approval for POC for the financial year 2024-25. The case was heard by Dr. Rajesh Sharma, Chairman, and Shri Hemant Kumar Jain, Member, through several hearings conducted during 2024 and 2025.

The Commission has now finalized the POC structure with distinct rates for different categories of captive power plants. Conventional captive power plants will be charged at a rate of ₹27.237 per KVA per month, calculated on their installed capacity. Renewable captive power plants, on the other hand, will be charged at a much lower rate of ₹11.90 per KVA per month. For hybrid captive plants that use both renewable and conventional sources, both rates will apply proportionally based on the share of each type of generation. This rate differentiation reflects the Commission’s intent to support renewable energy while ensuring that grid stability costs are fairly distributed.

The RERC order also provides clear guidelines on exclusions and applicability. Rooftop solar plants operating under either net metering or gross metering arrangements are fully exempt from paying these charges. Similarly, the levy is limited only to loads located on the same site or co-located with the generating plant. Offsite captive power plants are not covered under the POC framework. The charges will be calculated based on the net capacity of the generators, which means the total installed capacity minus the portion used for open access. For co-located plants, the POC will be levied on the capacity used by the co-located load, regardless of whether they qualify as captive plants. However, any capacity already covered under existing Power Purchase Agreements (PPAs) between Discoms and captive plants will remain exempt from these charges.

On the matter of implementation, the Commission clarified that since the financial year 2024-25 has already ended, and the same charge was approved in the Annual Revenue Requirement (ARR) and tariff order for 2025-26, the POC will apply prospectively. This means the charges will take effect only from the financial year 2025-26, ensuring there is no retrospective imposition on captive consumers. The Commission also directed that all revenues collected under this head must be properly included in the future ARR and true-up petitions submitted by the Discoms for the Commission’s review and approval.

With these decisions and directions in place, the RERC has brought closure to a long-standing issue related to the determination of parallel operation charges for captive power plants in Rajasthan. The order strikes a balance between the interests of renewable energy generators, conventional captive users, and the state’s distribution companies, ensuring both fairness and regulatory clarity in the state’s power sector. The petition was formally disposed of following the issuance of this comprehensive order.