Giving a shocker to the renewable energy industry in Madhya Pradesh, the state regulator has taken away the must-run status of power generated from renewable energy sources.
In the latest order issued by the Madhya Pradesh Electricity Regulatory Commission (MPERC), it was said: “the generation from co-generation and renewable sources of energy to be subject to scheduling. The generation from wind, solar, small hydro, and municipal waste shall not be subjected to merit order despatch principles.”
Sector and legal experts said this would harm the renewable energy projects as the state would now have the freedom to back down renewable projects whenever it wishes to.
Renewable power enjoys must-run status across the country so as to ensure its integration in the grid and better returns to the developers.
The order pertains to the amendment in the Madhya Pradesh Electricity Regulatory Commission (Cogeneration and Generation of Electricity from Renewable Sources of Energy) (Revision-I) Regulations, 2010.
The order also said the renewable power producers would also have to pay all wheeling, transmission, cross-subsidy charges live conventional power producers. This is a jolt to the renewable sector in the state as the low rates received in past years was because the state was the first one to offer exemptions on additional charges borne by power producers.
“Wheeling charges, cross-subsidy charges, the additional surcharge on the wheeling charges, if any, under the Section 42 of the Electricity Act, 2003 shall be applicable at the rate as decided by the Commission from time to time in its retail supply tariff order,” the order stated further.
The order further said all the charges levied on the power supply. The MP government while issuing its first tender in 2012 had exempted the developers from all the charges. It was the first state to do that and was the reason for companies to form a beeline to invest in the state and quote low tariff, especially in the Rewa Solar park tender.
