KERC Proposes 2025 Draft Regulations For Forecasting, Scheduling, And Deviation Settlement In Karnataka’s Renewable Energy Sector

The Karnataka Electricity Regulatory Commission (KERC) has released a draft notification for the “Forecasting, Scheduling, Deviation Settlement Mechanism and related matters for Sellers and Buyers of Wind, Solar and RE-Hybrid Generation sources Regulations, 2025.” This step follows the notification of the Karnataka Electricity Grid Code 2025 and reflects the State’s position as a “Super Rich Renewable Energy State,” with an estimated potential of 155,074 MW and an installed capacity of over 15,942 MW as of June 2025. The draft regulations are aimed at ensuring secure and stable grid operations while promoting accurate forecasting and scheduling by renewable energy generators and buyers.

The regulations apply to wind power generators with a capacity of 10 MW and above, solar and hybrid generators of 5 MW and above, and buyers with a capacity of 1 MW and above. These entities are required to provide forecasts on a week-ahead, day-ahead, and intra-day basis to the State Load Despatch Centre (SLDC). Accurate forecasting and scheduling are expected to strengthen grid stability and support the integration of increasing renewable energy capacity into the State grid.

A central feature of the regulations is the role of the Qualified Coordinating Agency (QCA), which acts as a nodal agency for generators. QCAs are responsible for forecasting, scheduling, and settling payments arising from deviations. Multiple QCAs are not allowed at a single pooling sub-station; however, individual generators or buyers may choose to manage these functions themselves or opt for SLDC services for a fee. This framework is designed to streamline operations and ensure accountability.

The draft introduces a Deviation Settlement Mechanism (DSM) to penalize deviations between scheduled and actual power injection or drawal. Errors are calculated as a percentage of actual generation or drawal against scheduled amounts. Tolerance limits are set at ±10% for wind and hybrid generators, and ±5% for solar generators and buyers, while Energy Storage Systems (ESS) paired with renewable sources have a “Nil” tolerance. Deviations beyond these limits attract charges starting at Rs. 0.25 per unit for minor deviations, rising up to Rs. 0.75 per unit for larger errors exceeding 25% or 30% of the schedule. All charges are to be deposited into the “State Deviation Pool Account Fund” within ten days, with late payments accruing simple interest at 0.04% per day. Funds collected will be utilised to improve the grid, including relieving transmission congestion and installing protection schemes.

The draft also includes measures to prevent “Gaming,” defined as intentional mis-declaration for commercial gain. The Commission has the authority to initiate inquiries and disallow deviation charges for entities found guilty of such practices. However, no penalties will apply during grid emergencies or planned curtailments if the SLDC fails to communicate these events.

Stakeholders and the general public have been invited to submit comments, suggestions, or objections regarding the draft regulations by January 13, 2026, to the Secretary of the KERC in Bengaluru. This public consultation process is intended to ensure transparency and stakeholder participation while finalising rules that aim to improve forecasting, scheduling, and grid stability in Karnataka, supporting the State’s ambition to integrate large-scale renewable energy efficiently and reliably.

The move is expected to provide a structured framework for renewable energy generators and buyers, promoting accountability, minimizing deviations, and ensuring that Karnataka’s electricity grid operates efficiently as the State continues to expand its renewable energy capacity.