Apart from many changes coming into effect from the new financial year, the rooftop solar consumers in Maharashtra will be jolted as new tariff relating to surplus power would kick into effect, that virtually puts paid to their efforts to opt for green power. Maharashtra Electricity Regulatory Commission (MERC) has slashed the tariff for surplus power to Rs 2.82/unit, that earlier used to be in range of Rs 3.30 to 3.50/unit. What’s more surprising is that Commission changed the ground rules, wherein it used to every year derive rate for surplus power transferred to grid. Instead, from April 1, the new tariff would hold good for a period of 5 years.

 

The order came when activists working to protect consumers’ interest were busy with multi-year tariff petition. So only six objections were filed, mostly from bio-gas sector, on the petition that was taken suo-motu by the Commission. Analysing the order, Sudhir Budhay, an authority in renewable energy field, said mostly, the small commercial and industrial units that are having rooftop solar unit, would be impacted. More so, when the Grid Support Charge (GSC) comes into effect. The same would be when MSEDCL achieves 5 MW solar power capacity. Post GSC, the rate for consumers is going to fall to Rs 0.72 for LT consumers, which effectively puts paid to consumers efforts to support the Central Government’s initiative to achieving target of 50 GW of renewable power.

 

As of now, household rooftop units will not be affected. But they too will feel the heat when GSC component implementation starts on part of MSEDCL. As of now, the solar power capacity in State has reached 3.5 MW and reaching 5 MW target is not much difficult. In a way, it all depends on the rulers as even if they declare it tomorrow, there is no way to challenge the same, said Budhay. About the fixed rate, he said, the main disadvantage is that the benefit of indexing effect, the same calculation on which MSEDCL every year jacks up power tariff, will not be available from now to the consumers. And the most surprising aspect of the order according to Budhay is that MERC derived Rs 2.82/rate by comparing it with Mukhyamantri Saur Krushi Vahini Yojana (MSKVY) 2.0.

 

The agriculture power scheme comprises of large-scale utility scale solar projects that derive benefits from low-cost financing, provision of land from the Government and other institutional support. Further, the MSKVY projects are in MW range. Compared to that, individual rooftop solar units are in 2.5 to 10 kW range, and the investment in them is quite high upfront. MERC could have looked into the Indian Railways’ recent tender for purchasing solar power where they derived the rate of Rs 4.50/unit, which is quite realistic as same reflects the ground situation. A comparison with mega scale projects is impractical and a disadvantage to the individual consumers. Most of the time, while going for comparison in industry, there is a standard practice, apple to apple way, this would have provided accurate way to derive the rate for surplus solar power. Budhay feared, the new rate, that too, for 5-years period, might hit hard the ongoing solar aggregators, as why would commercial and industry go for locking up huge investment when the returns are negative.

 

Mahendra Jichkar, energy activist, feels that as they got busy with the MYT, they inadvertently overlooked this quite important hearing on solar power in MERC. With the rate locked for 5 years, the consumers might rue their decision to opt for rooftop. These days, the changes in Government policy is most unpredictable and though the rooftop units’ life is meant to be of 25 years, the way consumers are getting cornered, the day is not far when the small consumers start uprooting the system as the policy shift may slowly make them a liability to own.

 

 

If one is to derive the conclusion for consumers, rooftop solar is, as Sudhir Budhay said, intended for self-consumption, not for generating income through surplus export to the grid. Contd on page 2