Offtake default: Fixed charge to be paid to renewable energy players defined

The Ministry of New and Renewable Energy has defined the fixed charge to be paid by a power distribution company (Discom) to a renewable energy power generator in the event of an offtake default.

According to the memorandum issued by the Ministry, the fixed charge for renewable energy players will be calculated on the basis of the capacity utilisation factor specified by the generators in the power purchase agreements.

“For projects having more than one year operation, the power not dispatched shall be calculated on the basis of pro-rated actual energy generated in the last 12 months,” the memorandum said. The move is significant as till now, there was no definition of a fixed charge that was to be paid to solar and wind power generators by the Discoms.