Green Open Access Rules 2022 – An Explainer

The ministry of power recently released the ‘Green Open Access Rules, 2022’ to accelerate India’s renewable energy programs. These rules address measures aimed at promoting generation, purchase and consumption of green energy including through waste-to-energy plants. The move is aimed at ensuring affordable, reliable, sustainable and green energy for all. It also enables a simplified, uniform and streamlined procedure for granting open access to green energy. This will ensure faster approval and smoother voluntary purchase of renewable power by commercial and industrial consumers, while simultaneously improving the predictability of cash flows for renewable power producers. 

To make the application process transparent, it will be channeled through a national portal, and approval will be granted in 15 days or else it will be deemed to have been approved, subject to the fulfillment of technical requirements. Any consumer can demand green power from discoms (power distribution companies) and there is no minimum limit for captive consumption. Reduction in the limit of open access transactions from 1 MW (megawatt) to 100 kW (kilowatt) for green energy will now enable even small consumers to purchase renewable power through open access. The move is especially expected to prompt smaller industries, commercial consumers, and large households into shifting towards green energy. Consumers who opt for green power will be given green certificates.

The power ministry has now capped cross-subsidy surcharge (CSS) and notified removal of additional surcharge (AS) on open access consumers to further incentivise consumers to go green and address the issues that have previously hindered the growth of open access in India. The rules also provide certainty on other open access charges to be levied on consumers, such as transmission charges, wheeling charges, standby charges, etc. There will be a uniform renewable purchase obligation (RPO), on all concerned entities in the area of a discom, including the fulfillment of Green Hydrogen/Green Ammonia obligations. Cross-subsidy surcharge and additional surcharge shall not be applicable if green energy is utilised for the production of green hydrogen and green ammonia. The tariff shall be determined separately by the appropriate commission, which shall comprise the average pooled power purchase cost of the renewable energy, cross-subsidy charges if any, and service charges covering the prudent cost of the distribution licensee for providing the green energy to the consumers.

India added 1.2 GW of solar open access installations in 2021, which grew by 22 per cent to 513 MW during January-March 2022 and as of March’22, cumulative installed solar open access capacity in the open-access market was over 5.7 GW and over 2 GW capacity of open access solar projects was under development, according to a report by Mercom India. Some of the recent projects towards building solar capacity in India are – (i) Torrent Power acquired SkyPower Group’s 50 MW solar plant in Telangana for INR 416 crore, (ii) Axis Energy and Brookfield Renewable India commissioned solar projects in Rajasthan with a capacity of 445 MW each, (iii) Maruti Suzuki set-up 20 MW solar power plant in Manesar, (iv) Assam Government, in a joint venture with NLC India Ltd. to produce 1 GW+ solar power, (v) Tata Power Solar bagged multiple projects including one from NHCP, reaching total utility-scale solar project portfolio of 9.7GW, etc. Additionally, these new set of rules have also prompted significant strides in wind energy development to further enhance India’s open-access renewable energy reserves, e.g. – (i) GE and Continuum Green Energy will work together on the 148.5 MW Morjar onshore wind project in Gujarat, (ii) Cipla has commissioned a wind-solar hybrid captive power plant (9 MWp solar + 2.7 MVA wind) with CleanMax Enviro Energy Solutions in Karnataka, etc.

Hence, Green Open Access Rules 2022 are believed to be a huge stepping stone towards achieving India's commitment to 500 GW of non-fossil fuel energy by 2030.

This article has been written by Karishma Sharma and Cherishi Maheshwari.