Open Access Power Procurement For Corporates
Open Access Power is a facility which enables large power consumers with connected load of over 1 MWp to procure cheaper electricity from the open market in India. The purpose behind such a facility is to permit and enable customers to choose among a large number of electricity supplying companies rather than solely depend on one single state utility discom and its monopoly.
Open Access facility not only helps industrial and commercials customers avail continuous and lower cost of electricity that boosts operating cost of their business but also meet their Renewable Energy Purchase Obligations (RPO) as well. On the other hand, Open Access solution reduces the electricity shortage problem in India as a number of renewable energy producers can now transmit electricity from their respective renewable energy farms to various consumer points.
Open Access Procurement Process
Key Benefits
NIL Investment
Open Access facility is procuring electricity from a third party and hence there is no upfront investment for a client.
Guaranteed Savings
Electricity that is purchased via Open Access is at a rate lesser than grid energy cost and hence come with guaranteed savings.
Continuous Supply
Electricity that is purchased via Open Access from open market is a continuous supply of electricity unlike grid energy cuts.
Risk Free Solution
Due to zero investment and zero scope of operations and maintenance, the Open Access solutions are hassle free with no risks.
Frequently Asked Questions
Any consumer who has a connected load of 1 MWp and above can procure Open Access electricity. However, every state in India has different Open Access policy in regards to who can avail electricity and hence the criteria may differ from state to state.
Yes, procuring green renewable energy via third party solar energy or wind energy plants under Open Access facility will enable industrial and commercial consumers meet their RE100 targets.
There are primarily two variants of models in Open Access under which electricity can be procured
- Third Party Open Access
- Captive or Group Captive
A consumer will need to bare the following charges when procuring electricity under Open Access:
- Cross Subsidy Charges
- Wheeling Charges
- Transmission Losses
- Banking Charges
- Wheeling Losses
- Additional Surcharge
The following are the risks and challenges:
- Regulatory Challenges
- Open Access regulations and charges remain uncertain and can change from time to time
- Eligibility criteria may change
- Elongated approval process
- Utility's interference
- Operational Challenges
- Performance risk
- Grid Curtailment risk
No, the existing transmission and distribution infrastructure can be utilised to procure electricity under Open Access. Apart from minor changes in the installed meter, the electricity transactions are primarily managed through energy accounting at the state discom level. Hence, a consumer buying electricity under Open Access will be able to see the transaction accounted for in its monthly bill.
When a buyer and a seller are located within the same state, then procurement of electricity in such a transaction is called an Intra-state transaction. In this transaction, the Open Access charges includes the transmission losses and its associated charges, wheeling losses and its associated charges (if applicable) and cross-subsidy of that particular state are applicable. However, when both the buyer and seller are located in different states then procurement of electricity in such a transaction is called an Inter-state transaction. In this case, besides the Open Access charges applicable in intra-state transactions, Point-of-Connection (POC) charges and losses of the regional grids where the buyer and seller are located are also included.
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