by Open access is a method which allows business and industrial consumers with significant power demand to buy electricity straight from independent power producers (IPP). With the implementation of this idea, industrial and commercial consumers who have large-scale requirements will be able to leverage its benefits. This will help businesses reach their sustainability targets by reducing their carbon footprint. India is already seeing a surge in solar open-access installations with the addition of 907 MW in the 3rd quarter of 2023, which is around 36.1% increase from 666 MW in the previous quarter. Under open access solar arrangement, the power producer installs a solar power plant in a suitable location and signs an agreement with a consumer for a medium- or long-term electricity purchase.
Working Process of Open-Access Solar
- A long-term Power Purchase Agreement (PPA) is signed between the solar power plant and the power consumer, also referred to as the off taker.
- The solar power plant conceptualizes, plans, and finances the entire undertaking. As required by regulations, the off taker is also required to invest exclusively in equity in the captive model.
- Power is generated and sold to the off-taker at a set tariff under an open-access solar route.
- The power plant uses real-time analytics and remote monitoring devices to ensure optimal generation without power disruptions.
- Consumers only pay for the units they have really utilized, ensuring savings from the outset of the company.
Open access power arrangement is mostly governed by a long-term Solar Power Purchase Agreement (PPA), which is signed by the power provider and the consumer. The power producer commits to supplying the annual quantity of units at the set tariff throughout the term of the PPA. When it comes to the application of open-access solar levies and taxes, the current state-government standard is observed.
Let us now discuss the product offerings under open access – captive open access and third-party open access.
Product Offerings
Captive Open Access
Captive plants have more favorable regulatory frameworks and deliver much higher savings as compared to third party plants. Sunsure Energy is an expert leader at supporting large companies through each stage of setting up captive solar facilities for open-access solar electricity.
- The starting investment for each megawatt-peak is Rs. 35 lakhs.
- Stability of energy prices throughout the long run
- Every state waives the premium for cross-subsidy.
Open Access via Third Party Agreement
Through long- and medium-term PPAs, they work with leading project developers to offer open access electricity power for corporate clients. Purchasing power from a third party produces immediate savings and doesn’t need any funding.
- The easiest way to decrease the electricity costs
- PPAs are valid for five years.
- Power delivery must start within 30 days.
Large users with linked loads greater than 1 MW can acquire affordable power on the open market thanks to open access to electricity. Traditionally industrial consumers had no choice but to buy power from the local utility provider. With the introduction of Open Access, the government’s goal is to provide them with the choice to choose from a range of competitive power providers sourcing power from different sources. By ensuring a consistent supply of electricity at fair pricing, it helps commercial and industrial users. It also expands the power markets business. Furthermore, open-access solar helps clients meet their Renewable Purchase Obligations (RPOs).
Open access solar power would ease the current power crisis, since multiple power suppliers, including solar energy companies, are now able to transport power from their solar parks to different load centers. The cost of energy naturally decreases when consumers have the choice to purchase it on the open market due to competitive pricing. Open-access solar rights are governed in India under the Electricity Act 2003, which set standards for competition in the power industry.
Location based Open Access
Depending on where the purchasing and selling entities are located, open access can be classified into the following categories:
Inter-State Open Access: The Central Electricity Regulatory Commission’s (CERC) guidelines must be followed because the parties buying and selling are from separate states. This transaction involves parties from different states, and the purchase rights for interstate open access can be for short term (less than a month), medium term (3 months to 3 years), and long-term (12 to 25 years).
Intra-State Open Access: Here, the purchasing and selling entities are of the same state. Intra state transmission system and distribution system would be required to give long-term open access. Based on the regulations of the respective states, intra state open access can be classified as short, medium, and long term.
Benefits Offered by Solar Energy Adoption
One significant feature of open access in the solar business is intra-state open-access solar arrangements, which occur when the consumer and the electricity-producing solar farm are situated in the same state. The consumer saves even more money with these intrastate agreements because they make use of the waivers offered by multiple state governments. Customers purchase the power at a reduced net landed price as a result, compared to what they would pay traditional power providers.
How is Sunsure Energy bringing sustainable change?
Sunsure Energy is one of India’s leading producers of renewable energy with a focus on C&I. Partners Group AG has given Sunsure $400 million in equity support to generate more than 3 GW of renewable energy assets by 2027. Since its establishment in 2015, the brand has built solar power plants for its industrial clients in 16 Indian states that have high power requirements. Due to its capacity to provide full decarbonisation solutions in line with long-term corporate sustainability aspirations, Sunsure is the preferred partner for Indian firms committed to fulfilling RE100 targets.
Leading independent power producer in India, Sunsure excels at providing solar and wind energy solutions. Majoring in the nation’s sustainable energy revolution, it is a major provider of renewable energy solutions, offering open-access solar and behind-the-meter options to commercial and industrial (C&I) clients. The company also has experience with distributed and utility-scale RE projects. Partners Group AG has invested $400 million in Sunsure, further supporting its growth trajectory in addition to strategic collaborations and a commitment to a greener India.
