Maharashtra Electricity Regulatory Commission issued Draft MERC (Framework for Resource Adequacy) Regulations, 2024 in March 2024 and invited comments from the public by 15th April 2024. We commend MERC for taking the initiative on this important topic to be only the third Commission (after MPERC and PSERC) in the country to publish draft regulations for Resource Adequacy (RA).
Further, MERC notified the RPO, its Compliance and Implementation of REC Framework (First Amendment) Regulations, 2024 in February which not only stipulates a long term RPO trajectory of having 43.3% of energy from renewables by 2030, but it also mandates a 4% storage obligation by the same time period. As per the CEA’s 20th EPS, Maharashtra’s demand could grow to 250-290 BU by FY 2030. This would entail a cumulative procurement of 107-125 TWh/BU of RE and 27-32 GWh/day of storage by FY 2030. Thus, a very significant RE and storage capacity would need to be contracted over the coming years to fulfil the RPO and growing demand in a reliable manner.
These regulations provide a framework for Maharashtra DISCOMs to plan their power procurement in a cost-optimal manner taking cognizance of available technologies as well as changes in demand. Hence, this is a much needed and welcome step.
With this context in mind, Prayas (Energy Group)’s comments on the regulations focus on process related aspects and increasing clarity regarding some specific proposals, as highlighted below.
- Strengthening effective demand forecasting for multiple time horizons.
-Preferable to have 15-min block wise forecasts in line with the energy accounting and DSM/F&S practices rather than hourly.
-Importance of comprehensive disaggregated input data.
-Account separately for full and partial Open Access and Captive demand.
-Use of same detailed scientific demand forecast as done under RA in the MYT process. - Consider mandating 10 year (LT) Distribution Resource Adequacy Plan (LT-DRAP)
- Need for capacity building and a trial period (1-2 years) without penalties/non-compliance charges for non-compliance of RA.
- Need for synergy in practice across different regulations (e.g. MYT and RA regulations).
- Methodology to determine capacity credits, experimenting with few methods
- Explicitly state Planning Reserve Margin (PRM)
- Good innovation in allocation formula of share in National Peak
- Who is responsible for the resource adequacy for OA & CPP demand?
- Further clarifying nature of contracts and allowable contracts
- Finer resolution (preferably 15-min) of the RA studies
- Leveraging wider sector expertise in the country and mandatory public hearings prior to finalizing & approving RA studies and the procurement plans.
- Need for enhanced transparency
- Broadening scope of Energy Storage