Govt Announces Major Reforms For Open Access

(MENAFN- KNN India) New Delhi, Jan 15 (KNN) The Ministry of Power has introduced new regulations aimed at enhancing the ease of doing business, particularly for industries such as Green Hydrogen manufacturers, and promoting a smoother transition to sustainable energy, on Monday.

The latest rules enable consumers with a specified quantum of load and Energy Storage Systems (ESS) to independently establish, operate, and maintain dedicated transmission lines without the need for a license, as per an official release.

This move introduces a new category of Bulk Consumers, benefiting from more affordable electricity and improved grid reliability, a privilege previously reserved for generating companies and captive generating stations.

The importance of Open Access under the Electricity Act, 2003, is underscored, but challenges arose due to disproportionately high Open Access charges imposed by certain State Regulators, hindering its optimal utilisation by consumers.

To address this, the new rules prescribe methodologies for determining various open access charges, including wheeling charges, state transmission charges, and additional surcharges, with the aim of making these charges reasonable and uniform nationwide.

The rule specifies that for those availing General Network Access or Open Access, the additional surcharge will be gradually reduced and eliminated within four years from the grant date.

In an effort to ensure financial sustainability in the power sector, the rule emphasises the need for cost-reflective tariffs and the allowance of prudent costs.

The Minister of Power, R. K. Singh, highlighted that these measures have already reduced the losses of distribution companies from 27 per cent in 2014 to 15.41 per cent in 2022-23.

He expressed confidence that these rules would further diminish losses, enhance viability, and enable distribution companies to provide improved services to consumers.

Furthermore, the Minister emphasised that eliminating the license requirement for dedicated transmission lines in the industry will significantly ease business operations, fostering faster industrial growth and job creation.

Coupled with the rationalisation of open access charges, this initiative is expected to expedite the adoption of renewable energy by industries, contributing to emissions reduction.

Kindly refer to this article for more information:

(KNN Bureau)

MENAFN15012024000155011030ID1107723080