Presentation on Operationalisation of Open Access
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Transcript of Presentation on Operationalisation of Open Access
Regulators and Policymakers Retreat-2012 Presentation on
Operationalisation of Open Access
By
Ajoy Mehta, IAS,
Managing Director, Maharashtra State Electricity Distribution Company Limited
Date: 24th August 2012
Regulators & Policymakers Retreat, 2012
Regulators & Policymakers Retreat, 2012
Regulators & Policymakers Retreat, 2012
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Matter has raised important legal issues
Opinions of Attorney General of India, Solicitor General Of India
Planning commission- working group on OA Operationalisation in Feb-2010
Notification from Ministry of Power on Dt 30.09.2011
Discussions in the Forum of Regulators (FOR)
MoP has referred this matter for CERC to form regulations,
Comments on Operationalisation of OA has been asked by MERC
MSEDCL
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(a) Bulk consumers (above 1 MW) shall be deemed to be open access consumers w.e.f.
January 2009.
(b) The State Commission has no longer fix the energy charges to be paid by such a
consumer, but will continue to fix the wheeling charges and surcharges.
(c) Sec-49 shows that if certain consumers want to have the benefit of the option to buy
power from competing sources, then it is logical that DISCOMS/Distribution Licensees
do not have an obligation to compulsorily supply power to such consumers.
(d) Sec-42(3) is not a precondition for the implementation of open access as such a
notice is not for seeking permission to use the distribution licensee’s network, but
only to communicate the open access consumers intention of using such a network.
Ministry of Power Letter
Technical issues & Operational constraints
Financial Impact on MSEDCL.
Legal issues
Letter from MoP refers only legal issues in Open Access Operationalisation.
Opinion is in isolation with provisions in Act. ( They have not considered technical & operational Constraints.)
Deciding of OA tariff by Utility : Complex issue.
Methodology for implementation of OA is not mentioned any where.
It requires clarity/Change in regulation
CSS decided is not commensurate with migrated consumers tariff.
Infrastructure problems for new consumers.
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Particular Reguln Action by DL As per MoP Circular Remarks if MoP Circular is implemented
Application
for Open
Access
Reg.
No. 4.2
Scrutiny No Application, Just an
intimation is required
MERC (Distribution Open Access)
Regulations, 2005, needs to be
complied.
Eligibility
criterion
Reg. 3 Scrutiny of application for OA
capacity (should not be >
than CD)
Can not ascertain Open access may be granted to a non-
eligible consumer
Type of OA
Captive /
General OA
Sec. 9 /
10 of
Act
Ascertainment of applicability
of
CSS for General OA
Can not ascertain The DL may lose the legitimate revenue
in respect of cross subsidy surcharge
Grid
Connectivity
Reg. For existing consumer,
connectivity is available, but
for new consumer,
connectivity will be provided
For existing consumer,
connectivity available
For new, the consumer
has to apply
Utility has to bear cost of infrastructure
for new OA consumer
Arrears /
Dispute
Reg.
4.2.7
OA permission may be
rejected in case of non
settlement of dues
No control In case of arrears OA can not be granted
Installation of
SEM
Reg. 7 Ascertainment No clear guidelines SEM is a pre-requisite of open access,
must be complied. If SEM not installed,
proper Billing can not be done
Open Access
Permission
Will be granted Permission is not
required, Will be
deemed to be granted
SLDC has to monitor the fulfillment of all
regulatory requirements. SLDC has no
man power neither it is highly equipped
to look into all matters.
Particular Regul
n
Action by DL As per MoP
Circular
Remarks if MoP Circular is
implemented
Contract
Demand
Reduction /
Termination
Reg.
4.2.1 /
4.2.2
CD will be reduced to the extent
of OA capacity
We can’t have
any control over
its usage.
If CD not reduced, the DL has to
make provision for supply of
Contracted capacity
unnecessarily, resulting into
loss.Reg needs to be complied
Agreement Reg. 5 Will be executed between DL,
OA consumer & generator
No Agreement, will affect the
interests of both parties.Reg
needs to be complied
Joint Meter
Reading
JMR will be carried out ??? JMR needs to be carried out.
Billing Reg. 8 Billing to include wheeling
charges, CSS, Losses,standby, PF,
Who will bill OA
Consumer?
SLDC???
Reg needs to be complied
Standby
supply
Reg. 9 Will be provided at Temporary
Tariff through Agreement
??? No contract with DL, no
obligation on DL to provide
standby supply
Inter- state
open access
Will be permitted subject to
SLDC approval, generation units
to be given by SLDC/WRLDC
SLDC to
approve
Not mentioned in circular.
Over drawal Reg. 9 Will be charged at Temporary
Tariff
SLDC will charge
UI
The DL will decide tariff. Loss to
consumers in both cases.
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Details of deemed OA consumers (Contract demand above 1 MW) for FY 2011-12
Category No. of
Cons.
Sales Revenue ABR Migration of Consumers to
Open Access
Consumers below 1 MW
with MSEDCL
Mus Rs. Crs Rs./Unit % Sales Revenue ABR Sales Revenue ABR
HT & LT
Industries 1586 20,114 13,187 6.56 30% 6,034 3,956 6.56
14,08
0 9,231 6.56
HT & LT
Commercial 231 888 964 10.86 50% 444 482 10.86 444 482
10.8
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PWW 63 708 340 4.80 0% - - 708 340 4.80
Agriculture 42 329 24 0.74 0% - - 329 24 0.74
Railway 43 1,386 945 6.82 100% 1,386 945 6.82 - -
Total deemed
open access
consumers
1965 23425 15460 6.60 7864 5383 6.85 15561 10077 6.48
Total 1.94
Crs 81,835 38,135 4.66
Proportion of
deemed OA
consumers
0.01% 29% 41% 9.61
% 14.12%
19.02
% 26.43%
Impact on ARR for embedded consumers
Impact on tariff on common consumers
Impact on monthly revenue of utility.
Assumption of migration of consumers.
Fixed cost of Power procurement (Computation of additional surcharge on case to case basis)
Loss of CSS due to migration of bulk consumers.
Increase in loss of utility.
Burden of Opex/Capex on consumers of utility
1 MW and above consumers are deemed OA users
OA Category : SERC to fix wheeling charges & surcharge only
Dist. Licensee not to have service obligation
Notice is not for seeking permission to use the DL’s network but only to communicate intention of using such network
• Planning Commission has formed task force in Feb-2010
– SERC should be advised by Govt. for Operationalisation of OA & to specify wheeling charges.
– Standby charges should not exceed max.UI rate for applicable hrs plus 5% adm.charges thereon.
– SLDC/RLDC should be separate entity with functional & operational autonomy.
– Regulators should meet bulk consumers & act proactively.
– 25% of centers discretionary allocation of 15 % CPSU generating capacity may be made available for direct sale of CPSU to OA consumers.
– Amendment in Sec.62(1)(a) to make it explicit that supply of electricity by a generating company to DL includes supply through an electricity trader.
Not purchase excess energy injected
May charge temporary tariff for excess consumption.
Can charge high tariff for standby supply or may not provide stand supply.
O&M activity of consumers feeders.
Different negotiated tariff for OA consumers.
Can ask to revise CSS & wheeling charges