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MSEDCL Petition on Open Access Electricity

Effect of MSEDCL petition on Renewable Energy Open Access Electricity Consumers

The Maharashtra State Electricity Distribution Company Limited (MSEDCL) has proposed plans for Time of Day (ToD) tariff charges and rebates and other tariffs, effective in the coming financial year (Fiscal Year 2025-2026). These changes may concern if they are accepted by the MERC. Below, we break down what’s happening and potential solutions on how you can respond.

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Time-of-Day (TOD) Tariff Changes: Implications for Consumers

MSEDCL proposes major revisions to its Time-of-Day (ToD) tariff system, effective FY 2025-2026, aiming to balance grid demand by encouraging off-peak usage. However, this could substantially impact solar consumers and businesses.

Key Changes in the ToD System:

Daytime Solar Use

Old: No rebate from 6 AM – 9 AM & 12 PM – 6 PM.
New: ₹2.15/unit rebate from 9 AM – 5 PM.

Evening Power Costs (5 PM – 10 PM)

Old: ₹1.10/unit surcharge.
New: Increased to ₹1.30/unit.

Night-time Costs (12 AM – 6 AM)

Old: ₹1.50/unit rebate.
New: ₹1.00/unit surcharge.

Implications:

Higher electricity bills for those using power at morning, evening, and night peaks.
Extended Payback Period for solar installations, delaying ROI by almost 1-2 years.
Challenges for small businesses & homeowners’ overall dependency on grid power will tend to increase due to proposed ToDs and their structure of charges.

Restrictions on Solar Net Metering

MSEDCL’s proposed limits solar electricity usage under net metering arrangement to 9 AM-5 PM only, forcing consumers to buy grid power at standard rates for night-time or early morning use.
MERC has updated rules allowing larger rooftop solar systems (up to 5 MW) in a move to support the Renewable Energy (RE) initiative of the Government of India. However, MSEDCL in its petition has mentioned its concern that this will lead to lost revenue and has filed a petition in Hon’ble High Court to challenge the changes. The Hon’ble Court’s decision will determine whether the new solar rules stay or are adjusted, so consumers should stay informed.
MSEDCL plans to introduce Grid Support Charges (GSC) for rooftop solar solutions above 10 kW to cover grid maintenance costs. As per MERC, these charges won’t apply until Maharashtra’s rooftop solar capacity hits 5,000 MW. MSEDCL is seeking approval from MERC for these charges to be implemented, but from the end consumer’s perspective, enabling these charges will mean delaying the Return on Investment even further.

Key Impacts:

Such restrictive proposed policies, if enacted, may hinder the adoption of solar and other renewable energies due to a reduction in incentives.
Increased Costs for Industries, potentially pushing businesses to fall back to grid power from Renewable ones.

Next Steps: What Consumers Can Do

Consumers have a critical role in shaping energy policies. Here’s how they can get involved:

Participate in the Process
- What It Is: Voice your concerns in public hearings or consultations on the tariff changes.
- Why It Helps: Collective feedback can influence final decisions, ensuring a fairer outcome for all.
Load Profiling
- What It Is: Assess your daily or weekly energy usage patterns.
- Why It Helps: Identifying which processes consume the most energy – and at what times – can reveal if shifting them to mid-morning off-peak hours (Zone C) is feasible.
Equipment Upgrades
- What It Is: Investing in more efficient machinery or lighting.
- Why It Helps: Reducing overall consumption can lessen the effect of higher surcharges.
Renewable Integration
- What It Is: Solar rooftop installations or on-site generation.
- Why It Helps: Producing your own power, especially during daytime hours, could reduce dependency on higher ToD rates and insulate you from further tariff hikes.

Conclusion

Open access electricity consumers need to have information on the latest updates on MSEDCL’s proposed plans including time-of-day tariff charges, limitations on solar net metering & new rates for the solar grid, which will likely increase costs for solar users & large consumers. To mitigate the cost impact of open access to electricity consumers need to upgrade their knowledge by engaging in public consultations & offering fair open-access solar policy. The main goal is to create a balance between grid stability, renewable adoption, and affordable consumer energy policies.

Disclaimer: This blog post is based on preliminary research on draft MYT order by MERC and MSEDCL’s petition. Final rates may differ subject to regulatory approvals. Always refer to the official tariff order for the most accurate, up-to-date information. All the views expressed above are personal opinion of the author of this blog.

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