RERC Clarifies Behind-The-Meter Captive Solar Plants Must Meet RPO Through Self-Consumption In Rajasthan

The Rajasthan Electricity Regulatory Commission (RERC) has clarified that industrial consumers operating captive solar power plants behind the meter cannot be exempted from Renewable Purchase Obligation (RPO) compliance. However, the commission provided relief by ruling that electricity generated and consumed through such internal renewable energy systems will be counted toward meeting their mandatory RPO targets.

The decision was issued through a common order by a three-member bench comprising Chairman Dr. Rajesh Sharma and Members Hemant Kumar Jain and Vijay Pal Singh. The order was passed on joint petitions filed by M/s Sudiva Spinners Pvt. Ltd. and M/s RSWM Ltd., seeking clarification under the RERC (Renewable Purchase Obligation) Regulations, 2023.

Sudiva Spinners operates a captive solar power facility with a total installed capacity of 14.984 MW across rooftop and ground-mounted locations at its manufacturing facility. RSWM Ltd. operates multiple textile manufacturing units in Rajasthan, including facilities at Rishabhdev, Kharigram, and Reengus, each having captive solar plants of more than 1 MW capacity connected behind the meter.

The companies had approached RERC seeking removal of difficulties under Regulation 6 of the 2023 regulations. They argued that industries generating and consuming their own renewable energy should not be treated as obligated entities under the RPO framework. According to the petitioners, RPO regulations were primarily introduced to encourage renewable energy consumption by reducing dependence on fossil-fuel-based electricity generation.

The companies also highlighted that several states, including Maharashtra, Gujarat, Haryana, and Karnataka, have provided exemptions or specific treatment for renewable energy-based captive plants. They further pointed out challenges related to carbon credit trading and International Renewable Energy Certificates (I-RECs), stating that global auditors often require clear regulatory confirmation regarding the treatment of behind-the-meter renewable energy generation.

The petition was opposed by Rajasthan Renewable Energy Corporation Ltd. (RRECL) and state distribution companies, including Ajmer Vidyut Vitran Nigam Ltd. (AVVNL), Jaipur Vidyut Vitran Nigam Ltd. (JVVNL), and Jodhpur Vidyut Vitran Nigam Ltd. (JdVVNL).

The respondents argued that captive consumers with renewable energy plants above 1 MW capacity fall under the definition of obligated entities as per Regulation 3 of the RPO Regulations, 2023. They maintained that the removal of difficulties provision could not be used to alter the basic provisions of the regulations.

RRECL also raised concerns over possible double counting of environmental benefits, stating that renewable energy attributes cannot be claimed simultaneously for RPO compliance and carbon credit trading.

After considering the submissions, RERC ruled that captive users with plants of 1 MW or above remain obligated entities under the state’s RPO regulations, irrespective of whether the generation source is renewable or conventional. However, the commission clarified that renewable electricity generated and self-consumed by these captive plants will be considered toward fulfilling their RPO obligations.

The order means industrial consumers with behind-the-meter solar facilities will not need to procure additional renewable energy certificates or green power for the portion of their RPO requirement already met through internal solar generation.

The commission also reiterated that renewable energy attributes cannot be claimed more than once, ensuring compliance with established REC and environmental accounting principles. The ruling provides regulatory clarity for industries investing in captive solar projects while maintaining the integrity of Rajasthan’s renewable energy compliance framework.