Government of Punjab had released its draft document on ‘Net Metering for Grid Interactive Roof Top SPV Power plants’ almost a year back. The policy as prepared by Punjab Energy Development Agency (PEDA) has now been approved. It would be applicable to all domestic, institutional, industrial, institutional and commercial consumers of Punjab State Power Corporation Limited (PSPCL). For the record, Punjab had come out with its policy before Delhi. Since I had covered Delhi’s solar rooftop policy (technically renewable energy net metering policy) in the previous post, I will try to compare the two where possible. The final version of the document could not be traced, but a draft copy is available for download at PEDA website.
Consumers can put up rooftop solar PV up to 80 per cent of their sanctioned load, measured on AC side at the output of the inverter. The system needs to be at least 1 kWp and can go up to a maximum of 1 MWp. It is important to note that only systems up to a maximum size of 500kWp can avail the 30% MNRE capital subsidy. As compared to this, Delhi has not (yet) set any upper limit or on the type of renewable energy to be harnessed (but it would be solar for all practical purpose). Unlike Delhi, the Punjab state government has set a target of 100 MW under net metering policy for the next one year so as to help the state to meet peak load demand during the day when solar power generation will be available. This aggregate capacity target will be decided by the state government on year to year basis.
Third party owned Rooftop PV net metering model
The Punjab policy specifically makes mention of leasing as a viable option. This is important because residential consumers may not really be in position to invest in rooftop solar. Thus project developers can lease out rooftop PV system to consumers and gain in terms of rentals or other profit sharing arrangement. However the policy makes certain observations,
- The electricity generated from such a system is used to meet the rooftop owner’s internal electricity needs while the excess generation is fed into the grid on net metering basis. This is why the policy talks of leasing solar PV system and NOT leasing roof space.
- Apart from the rentals, being a commercial entity the project developer can also claim accelerated depreciation on the capital cost of PV as tax benefit.
- PSPCL will engage only with the consumer of the premises and not the third party rooftop system owner
- With Open Access Regulations in force such third party owned system may imply wheeling charges and surcharge relating to cross subsidy. But in order to encourage solar energy roof top solar system installations set up under this policy would be exempted from open access regulations.
Net Metering, Connectivity and Safety
Bidirectional energy meter with both import and export recording feature will be installed at the cost of the SPV plant owner. The meter to be used however needs to be approved by PSPCL. The consumer would be held responsible for maintaining safety of the grid with features like islanding the solar PV system to be incorporated in the inverter. Inverter standards have been provided in the document. For grid stability it has been specified that cumulative capacity to be allowed for a particular distribution transformer shall not exceed 30% of the rated capacity of the distribution transformer.
At the end of the billing cycle an Energy Account Statement is issued. This will show quantum of export from roof-top Solar PV System, import of energy from grid, banked energy from previous cycle, net bill for payment by consumer for that billing period or net banked energy carried forward to the next billing period separately. In case net surplus energy is exported to the grid then this quantum of energy is treated as energy banked with the grid in the next billing cycle. The rooftop solar system under net metering arrangement, whether self-owned or third party owned installed on eligible consumer premises has been exempted from banking & wheeling charges and losses, cross subsidy and additional surcharge etc.
In case of net energy import from the grid, the consumer is issued an Energy Bill for net power drawn in the billing cycle. Energy Bill for both import and export will be prepared as per the Retail Supply Tariff. Export of power from the SPV should not be more than 90% of what is consumed from the grid, in a year. Settlement of net energy including any banked energy will be done at the end of each financial year. At the beginning of each financial year the cumulative banked energy is reset to zero. If the consumer consumes power from PSPCL and/or generated from solar plant or banked solar energy up to or more than the Monthly Minimum Charges (MMC) level in any billing period, MMC will not be levied. The consumer has to pay an application fee of Rs. 50/KVA alongwith the application form to PSPCL.
Injection of power from the rooftop solar PV system shall not be more than 90% of the total consumption from the licensee’s supply by the consumer in a Settlement Period
There is one important part of the policy which might turn out to be a deal breaker for many. The document reads – “injection of power from the rooftop solar PV system shall not be more than 90% of the total consumption from the licensee’s supply by the consumer in a Settlement Period”. The settlement period stated here refers to a financial year. So this basically means that in the period of a year, a consumer can only ‘feed in’ 90% of what they ‘draw out’ from the grid.
Delhi has put no such limit on its consumers. So while regular households (the ones on lower electricity tariff) who could have benefited from producing excess solar power and feeding it into the grid in Delhi, this will not happen in Punjab. The only consumers who can benefit are possibly the ones on higher electricity tariff, this includes high end residential consumers or the commercial ones if solar power is cheaper for them than grid power.
Renewable Purchase Obligation & Renewable Energy Certificates
Just like in the case of Delhi, the order clarifies that electricity generated under these Regulations will qualify towards compliance of Renewable Purchase Obligation (RPO) for the distribution licensee unless the consumer is an obligated entity. This has the potential to be an important tool to push Discoms for RPO compliance. Issuance of RECs is allowed under the ambit of eligibility criteria specified by Central Electricity Regulatory Commission. (UPDATE: There is some confusion here, clause 19.1 in the Punjab policy document says that “Net-metering injection is not eligible for REC“)
The document details out a lot of other procedures and technical specifications etc. but the prevailing tariff itself does not seem to be a strong motivation to go solar (as compared to similar category consumers in Delhi). Some consumers may choose the solar path if they are affected by irregular supply. But the limit on injecting only 90% 0f what is consumed as solar electricity may well turn out to be the Achilles heel no one wants.