The Uttar Pradesh Electricity Regulatory Commission (UPERC) has introduced new regulations known as the Uttar Pradesh Electricity Regulatory Commission (Terms and Conditions of Generation Tariff) Regulations, 2024. These regulations are set under Section 181, along with Section 61 of the Electricity Act, 2003. The regulations will be effective from April 1, 2024, to March 31, 2029.
The terms used in these regulations will have the same meanings as those defined in the Electricity Act. These new regulations replace the previous ones from November 9, 2019, and any amendments made to them. They apply in situations where the Commission needs to determine tariffs for any generation company or its units, as per Sections 62 and 86 of the Electricity Act. However, they do not apply to tariff determinations for power plants where tariffs are decided through competitive bidding under Section 63 of the Act, nor do they apply to power plants based on renewable energy sources, as these are covered by a separate set of regulations.
The regulations allow power companies to use the Clean Development Mechanism (CDM) for power plants that are approved and commissioned after April 1, 2024. Income generated from carbon credits through CDM projects will be shared in a specific way. In the first year after the plant starts commercial operations, 100% of the CDM income will go to the project developer. In the second year, the share of the beneficiaries will be 10%, which will increase by 10% each year until it reaches 50%. After that, the proceeds will be equally split between the production companies and the beneficiaries.
If there is any conflict between these regulations and the terms of a power purchase agreement between a production company and a distribution licensee or beneficiaries, these regulations will take precedence. For projects where the tariff is determined by the Commission, an Availability Based Tariff will be applied, as stated in Regulation 40 of the regulations.
The regulations also require an annual energy audit for each production unit of power plants, as per Section 61(c) of the Electricity Act, the Energy Conservation Act, 2001, the National Electricity Policy, and Uttar Pradesh’s Energy Policy, 2009. The results of these audits must be shared according to the Energy Conservation Rules, 2008. Additionally, production companies are required to submit performance reports to the Commission in the format specified in Appendix 1 of the Act.
The production centers must coordinate with the State Transmission Utility service provider for transmitting the electricity they generate, following the Grid Code provisions under Section 10(3)(b) of the Act. All power plants and companies must comply with the rules, regulations, and directives issued by the relevant authorities or the Commission related to electricity production and dispatch.
The regulations also provide definitions for various terms used in the context of electricity generation and tariff determination to ensure clarity and consistency.
