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UPERC Drafts New Regulations to Boost Renewable and Captive Power in Uttar Pradesh

The Uttar Pradesh Electricity Regulatory Commission (UPERC) has released the draft UPERC (Captive and Renewable Energy Generating Plants) Regulations, 2024, revamping its 2019 framework to accelerate renewable energy deployment and improve captive power generation. The new regulations, effective until March 31, 2029, apply to non-renewable captive plants with capacities of 1 MW or more and to renewable energy plants of 100 kW and above—aligning with open access eligibility norms.

The regulations overhaul tariff structures, with fixed and variable tariffs detailed in Schedule-I. Bagasse-based tariffs, for example, will rise from Rs4.30 to Rs4.83/unit over five years. New projects (excluding MSW) must use competitive bidding under Section 63 of the Electricity Act, 2003, while MSW tariffs will be determined on a project-specific basis.

A major shift is seen in banking provisions: solar, wind, and hybrid projects can bank up to 25% of monthly injected energy or 30% of consumption. Bagasse-based plants have a 49% quarterly cap. Banking will be phased out for existing non-renewable captive plants and not permitted for new ones. Banking charges are set at 8% for RE and 12% for others, with unutilized energy eligible for RECs.

To ensure grid reliability, all plants must meet technical, emission, and grid code standards, with Deviation Settlement Mechanism (DSM) compliance required for all except small hydro and MSW. The regulations also encourage innovation through 5 MW pilot projects using emerging technologies.

Performance incentives of Rs0.50/unit are introduced for plants exceeding PLF/CUF targets. The policy aligns with national green open access rules and aims to lower procurement costs, protect discoms, and support a sustainable energy future in the state.