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The policy enables the effective utilization of renewable energy generated by providing guidelines for grid interconnection. Producers of renewable energy can feed the additional energy directly to grid thus enabling full utilization of generation capacity even when the primary load demand is less than the generation capacity.
The net metering regulations provide guidelines for distribution companies and renewable energy generators to connect renewable energy to the grid. The regulations define the technical standards, and the administrative framework for providing a net metering connection to the renewable energy generator.
Net-metering policy is enacted for encouraging the adoption of renewable energy at domestic and commercial scale. This policy provides a direct incentive to the consumer in terms of reduced energy bills and effective utilization of renewable power.
The net metering system is an instrument for allowing the energy generators to feed any surplus renewable energy to the grid. The electricity fed into the grid is offset from the energy bill of the consumer providing a net incentive on the differential cost of renewable energy generation and grid electricity. Furthermore, the surplus energy fed into the grid gets carried forward to the next billing cycle if the energy generated is larger than the energy consumption of current billing cycle.
Policy is mainly targeted towards adoption of distributed renewable systems and aims at maximum self-consumption of renewable energy generated onsite.
Net metering regulations are formulated as per the provisions of the electricity act of 2013 (EC Act 2013 specify that electricity regulatory commission shall promote the electricity generation through co-generation and renewable energy sources by providing suitable measures for connectivity to grid, as well as make regulations for to carry out the provisions of EC Act).
The regulation explicitly specifies that in order to avail grid connectivity the generator shall comply with state and national supply / distribution code & grid standards; measures of safety and electricity supply Regulations, 2010 and Technical Standards for Connectivity of the Distributed Generation Resources Regulations formed by central Electricity authority (CEA) in accordance to the provisions of electricity act.
The policy is formed by respective states electricity regulatory commissions by adopting and modified the draft regulations formed by Central Electricity Regulatory Commission (CERC). Implementation is done through Distribution Companies (DISCOMs).
This policy also support other policies such as the solar rooftop program, national solar mission and The Renewable Purchase Obligation (RPO) on DISCOMs. The RPO regulations are enacted to ensure the utilization of renewable energy. These regulations define the minimum percentage of the total energy consumption that an obligated entity must purchase from renewable energy generators. The RPO are defined as solar obligation and non-solar obligation.
India has set an ambitious target for renewable energy installation of 160 GW out of which 100 GW will be through solar energy, further within this 100 GW, 40 GW is targeted through rooftop solar plant. As per an estimate, the renewable energy market potential for rooftop solar system alone is around 124 GW (MNRE). The net metering regulation provides an instrument to realise this potential. The policy also facilitates the DISCOMs in sourcing renewable energy for meeting the Renewable Purchase Obligation (RPO) targets.
Net metering policy was introduced to promote onsite renewable energy generation and consumption. It enables the maximum capacity utilization of renewable energy system and cost reduction by eliminating the need for energy storage.
The aim of the policy is to promote renewable energy generation for self-consumption of consumer. It facilitates the grid interconnection of renewable energy generators. Regulations are provided for implementation of the grid connection. Main implementation body are DISCOMs, which purchase the power generated by the renewable system. The consumer is billed based on the net energy consumption after offsetting the energy generated. A direct incentive for consumer is that the cost of renewable power generation is less than the grid electricity, which is being offset.
The policy is implemented by local body (DISCOM) and regulations are formed by the state governments as per the guidelines of central government.
India is observing the unprecedented growth across all sectors and as results there is an increase in energy demand. Also the country has always faced energy deficit in terms of both energy generation and capacity. The adoption of renewable energy at distributed level will contribute in satisfying the increasing energy demand as well as reduction in the overall carbon footprint. The net metering regulation is the key instrument in wider adoption of renewable energy systems at building level.
These regulations will promote the renewable energy generation and the grid connected systems which have better efficiency and financial viability compared to stand alone systems based on storage.
The DISCOMs are the implementing agency for the net metering connection and they have to conduct the technical feasibility and report the minimum and maximum capacity of all distribution transformers available for connection of renewable energy systems.
The renewable energy are eligible for net metering connection if they are an existing consumer of the DISCOM. The regulations also provide the minimum technical and safety requirements for grid connection which has to be adhered by the consumer and verified by the DISCOMs.
Agencies or other actors responsible for implementation
DISCOM (Electricity Distribution company or Distribution licensee).
To implement net metering the applicant must be the buyer of electricity from a Distribution licensee.
Actors responsible for design
Central and State Electricity Regulatory commission (regulatory body).
Energy generated by renewable energy system and net energy consumption of the consumer is recorded by the DISCOMs for energy billing purpose.
Actors responsible for implementation
Electricity distribution companies (DISCOMs) (public or private companies).
Dynamic market transformation and or innovation
The policy drives consumers towards implementation of renewable energy systems and enables the energy producers to connect to the electricity grid.
Minimising rebound effects
Probable rebound effects will occur in the areas where the grid availability is very low. The energy consumption could increase due to the availability of electricity. However, this is a desirable impact.
Creating spill-over effects
The net metering regulations drive the market towards adoption of renewable power by providing the instrument for efficient and economic use of renewable energy system. Also the policy is facilitating general interest towards renewable energy into releasing the actual implementation of such systems through net metering path.
Design for sustainability aspects
Increase in renewable power in energy mix will reduce the environmental impact per unit of energy consumption. Another indirect benefit are energy savings due to avoided distribution losses.
The following barriers have been experienced during the implementation of the policy:
There is a technical limitations of the existing infrastructure (technical and financial concerns of DISCOMs to integrate renewable systems into grid).
The following measures have been undertaken to overcome the barriers:
The regulations will support achieving national target of 160 GW of renewable energy installations by 2022 of which 40GW are rooftop solar photovoltaic capacity installation. The policy itself does not specify any target but it will help to achieve this targets by accelerating the adoption of renewable energy systems at building level.
As per MNRE report total 2.5 GW rooftop capacity has been sanctioned out of which 166 GW has been installed as on Feb 2016 (MNRE, 2016).
Concrete figures in energy savings/year
Net metering regulations is not part of the energy saving / generation targets. This policy only provides regulations and guidelines for grid interconnection of distributed renewable energy systems (specifically rooftop solar PV systems).
Average electricity cost paid by end user in India is around 10 to 12 Rs/unit (data obtained from various energy audits conducted pan India).
For small and medium sized solar PV systems levelized cost of electricity generation is around 6 to 7 Rs/unit thus providing the opportunity for net benefit of INR 3 to 5 per unit of electricity used for end user.