Green Tariff Policy launched

Union Government is working on a ‘Green Tariff Policy’ with the objective of reinforcing India’s green energy credentials.

Green Tariff Policy

  • Green Tariff Policy will help electricity distribution companies (DISCOMs) supply electricity generated from clean energy projects at a cheaper rate as compared to power from conventional fuel sources such as coal.
  • Large corporate who are looking to procure only green power, they can contract such power from a clean energy developer as it is done in commercial and industrial (C&I) segment.
  • Once the policy is finalised, DISCOMs can exclusively buy green electricity and supply it at ‘green tariff’.
  • Green Tariff will be the weighted average tariff of green energy that consumer will have to pay.
  • The tariff will be slightly lower than tariff from conventional fuel sources and a new regulation will help to ensure, if an industry wants only green power from developer, open access applications will be approved within a fortnight.

Open access

Open access allows large users of energy, consuming over 1 megawatt of power, to buy energy from open market, instead of depending on expensive grid. However, state DISCOMs are not allowing clean energy developers to use power transmission and distribution networks to supply electricity to third-party.

Background

Green tariff policy is being finalised in the backdrop of India’s solar and wind power tariffs hitting a low of ₹1.99 per unit and ₹2.43 per unit respectively.

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