day-3, ms. shruti bhatia
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Open Access: Barriers and Enablers
3 August 2013, Goa
Shruti Bhatia, IEX
In this presentation
• Open Access present scenario
• Barriers to Open Access
• Enablers for facilitating Open Access
Status of Open Access
• Electricity Act, 2003 envisages implementation of open access for
1MW+ customers by January, 2009
• IEX is a pioneer in operationalisation of retail open access, first
transaction was in August, 2009
• Several operational and regulatory challenges have led consumers
to choose partial open access and not full open access
• Consumer maintains its supply agreement with local distribution company and leverages market for economical reasons and/or contingency power.
Increasing OA participation
0
500
1000
1500
2000
2500
58 72156
251411
756924
1063
1237
1609
1804
2080
2286
9 23110
357
606702
804 873954
10591149
1334
1530
1812
1989
Members+Clients Open access consumers
No.
of P
artic
ipan
ts
IEX Data as on 30th June, 2013
State-wise Open Access Consumers at IEX(As on 30th June 2013)
Andhra Pradesh
Tamil Nadu
Punjab
Gujarat
Haryana
Rajasthan
Uttarakhand
Karnataka
Madhya Pradesh
Kerala
Arunach
al Pradesh
Maharash
tra
Others
0
100
200
300
400
500
600
700
597
499
303
226
146121
40 26 11 8 4 3 5
No.
of O
pen
Acce
ss C
onsu
mer
s
State-wise OA Consumers at IEXToday almost 2000 plus consumers are availing OA through IEX
State-wise Participation at IEX
State Generators Consumers
Jammu & Kashmir 3 0
Himachal Pradesh 3 1
Punjab 2 303
Haryana 1 146
Uttarakhand 1 40
Rajasthan 13 121
Madhya Pradesh 10 11
Gujarat 20 225
Maharashtra 10 3
Goa 1 0
Orissa 11 1
Chhattisgarh 10 0
West Bengal 2 0
Arunachal Pradesh 1 4
Meghalaya 3 2
Karnataka 45 26
Andhra Pradesh 22 597
Tamil Nadu 0 499
Kerala 0 8
Others 30 1
Total 178 1988
Load wise segregation
Load No. of OA consumers % of total OA consumers
< 1 MW 237 10%
1 MW--2 MW 873 37%
2 MW--5 MW 850 36%
5 MW--10 MW 239 10%
10 MW & Above 132 6%
237
873850
239
132
< 1 MW
1 MW--2 MW
2 MW--5 MW
5 MW--10 MW
10 MW & Above
OA consumers constitute 40-45% of volumes traded at IEX in DAM
Sep-09
Dec-09
Mar-10
Jun-10
Sep-10
Dec-10
Mar-11
Jun-11
Sep-11
Dec-11
Mar-12
Jun-12
Sep-12
Dec-12
Mar-13
Jun-130
500
1000
1500
2000
2500
472 541 563
748
1128 11211211 1147
13081090 1116
1535
1879
2242 22592114.56399
DAM Monthly Cleared Volume
Month
Clea
red
Volu
me
(MU
s)
OA status in IndiaNorthern Region
States Buy Sell
Haryana
Punjab
Rajasthan
HP
J&K
Uttaranchal
Delhi & U.P.
East & North Eastern RegionStates Buy Sell
Assam & Bihar
Manipur & Mizoram
Tripura & Sikkim
Jharkhand
Arunachal Pradesh
Meghalaya
Orissa
West Bengal
Western Region
States Buy Sell
Madhya Pradesh
DNH & DD-UT
Gujarat
Chhattisgarh
Maharashtra
Southern Region
States Buy Sell
Andhra Pradesh
Karnataka
Tamil Nadu
Kerala
Apr 10, 2023
Open Access is a win-win solution for all stakeholders
Industries• Reliable power supply• Source cheaper power• Save the value of lost load (VOLL)
State utilities (Discom & SLDC)• Cost savings , need not have to buy
costly power as per merit order• Serve retail consumers better• Financial gains through open access
charges
State• Increase in per capita consumption• Revenue addition in terms of taxes• Build up in generation capacities • Employment generation• Promote industrial & economic
growth
Retail Consumers• Increased availability• Better reliability of power• Benefits trickle down to consumers in
terms of low prices of products
Open Access Benefits
In this presentation
• Open Access present scenario
• Barriers to Open Access
• Enablers for facilitating Open Access
• High Cross subsidy surcharge• High wheeling charges• Additional surcharge
Regulatory Risks
• Certain statutes in the EA 2003 (Section 11, Section 37, Section 108, etc.) exploited by States to impede open access
Legislative Impediments
• SLDC – unequipped or unwilling• Procedural Bottlenecks• Physical infrastructural constraints
Operational Hurdles
Barriers to Open Access
• Restrictive Open access regulations across states: Punjab: High wheeling charges (Rs 1.19 per Kwh) Haryana: Only RTC & peak hour procurement Gujarat and Haryana: Proposal by DISCOMS to levy additional surcharge West Bengal: OA charges are prohibitive; CSS not determined in
consistence with mechanism prescribed under NTP 2006 Tamil Nadu: Section 11 Maharashtra: OA applicants required to go through MERC UP/Delhi/ Jharkhand/East& NE: Resistance by utility
In this presentation
• Open Access present scenario
• Barriers to Open Access
• Enablers for facilitating Open Access
Open Access Charges
•Sec 42 (2) :“….Provided also that such surcharge and cross subsidies shall be progressively reduced in the manner as may be specified by the State Commission…”
•NEP, 2005 Sec 5.8.3: “…..the amount of surcharge and additional surcharge levied from consumers who are permitted open access should not become so onerous that it eliminates competition…….”
•Tariff Policy 8.3.2: Tariff to be +/-20% of cost of supply by 2010-11
Implement existing statutes in EA 2003 and NTP 2006
Legislative reinforcement
•Strengthen Sec 11, 37, 108 to remove ambiguity and facilitate OA
•Sec 11: OA to generators restricted by state government by citing extraordinary circumstances•Sec 37: State governments can direct LDC to restrict power sale outside state in lieu of maintaining smooth and stable supply•Sec 108: Directions of state government will prevail where public interest is involved
•Sec 42(4) : Define uniform methodology of determination of additional surcharge
•Tariff Policy 8.5.6: “…In case of outages of generator supplying to a consumer on open access, standby arrangements should be provided by the licensee on the payment of tariff for temporary connection to that consumer category as specified by the Appropriate Commission…”
Strengthen EA 2003 by expanding, restricting and/or clarifying scope under certain statues concerning OA
Streamlining operational hurdles
• Segregate ‘content’ and ‘carriage’ business• SERC to allow financial segregation of charges in terms of energy charge, network
charge, network loss and surcharges and insist Discoms to reflect these charges in their consumer bills.
• MERC has already taken a lead
• Equip SLDCs• Use revenue accrued to SLDC from OA consumers for developing Infrastructure, and
building capacity ……. 100 OA consumers with an SLDC imply a yearly revenue of appx Rs 7 crores. • SLDCc can embrace technology to automate processes for NOC issuance, energy
scheduling and energy settlement….IEX has introduced SLDC interface to help manage NOCs of customers in the state of Punjab and Tamil Nadu. Other states may adopt it too.
• Open Access Registry (OAR) • OAR will bring in transparency and facilitate faster transactions using automatic
rule-based open access clearance while removing manual discretions
OAR Framework
OA Applicants LDCsFinancial
Institutions (in future)
Regulators
Stakeholders
OAR
• Store information of all OA consumers•Store information on all OA granted• Info on inter-state corridor available for STOA as uploaded by NLDC/RLDC• Info on availed STOA corridor
Open Access Registry
• An integrated IT based system where all OA approvals will be kept as depository in electronic form and hence carry out the STOA Transaction.
• Registry will function as an interacting medium between the OA Participants, Trade Intermediaries/PXs and National/Regional and State LDCs.
• It will act as a central mechanism for consolidating and settling transactions instead of the NLDC/RLDCs settling each trade individually amongst themselves.
• The OA Approval will be held in the form of electronic accounts and the registry system revolves around the concept of paper-less trading.
• It maintains current status of NoCs, STOA Approval for participants and Record of Information will be available to CERC, System Operators, OA Customers, Traders and PXs.
Benefits of OAR
- No need to issue separate clearances for bilateral and collective- Reduced transaction cost and less paperwork- Information of beneficiary and transactions is readily available
- Easy record keeping, facilitates movement & safekeeping of approvals- Enabler for progressive, investor friendly image and easy customer interface- Reduces chances of fraud
- Faster and efficient scheduling and change over from one segment to another.- For OA accounting and database - Operated & maintained by independent body
Thank you
Carriage Charges in Select States at 33kV Level
STU Charge (Rs./ kWh)
STU Loss(%)
Wheeling Charge(Rs./ kWh)
Wheeling Loss(%)
Punjab 0.27 2.50% 1.19 2.26%
Tamil Nadu 0.082 2.95% (incl. wheeling loss)
- Included in state loss
Andhra Pradesh (CPDCL)
0.09 3.53% .096 3.92%
Gujarat (all DISCOMs)
0.03 4.81% 0.12 10%
Rajasthan (JVVNL)
0.37 4.20% 0.11 3.80%
Cross Subsidy & Additional Charges in States
Cross Subsidy Surcharge(Rs./ kWh)
Additional Surcharge(Rs./ kWh)
Punjab 0.85 (all voltage levels) -
Tamil Nadu 3.50 - 3.61 (Presently Sub judice in High Court)
-
Andhra Pradesh (CPDCL) 1.30 – 3.58 at 33KV (Proposed) -
Gujarat (all DISCOMs) 0.45 (all voltage levels) 1.35 (Proposed)
Rajasthan (JVVNL) 0.05 - 0.18 -
Cross Subsidy surcharge is a charge levied on OA consumers to meet the current level of cross subsidy within the area of supply of distribution licensee
Additional Surcharge is a charge paid by OA consumers to meet the fixed cost of distribution licensee arising out his obligation to supply
Landed Cost to Consumer accessing DAM at IEX
Landed Cost to Consumer(Rs./ kWh)
Punjab 5.80
Tamil Nadu 3.51
Andhra Pradesh (CPDCL) 3.75
Gujarat (all DISCOMs) 4.38
Rajasthan (JVVNL) 4.21
Assumptions:- Price at which procured from IEX = Rs.3/kWh - Consumer connected at 33kV level- Consumer load = 1 MW- Calculating landed cost after adding POC, STU & Wheeling Charges & losses, NLDC operating & application charges, SLDC charges, IEX transaction charges
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