Green Energy Open Access Rules 2022 Spark 90 Percent Surge in C&I Open Access Capacity: IEEFA
The C&I open access market saw a 90.4 percent surge in installed capacity in FY 2024, reaching 18.7 GW, driven by regulatory clarity under the 2022 Green Energy Open Access Rules, according to IEEFA and JMK Research report.
December 11, 2024. By Mrinmoy Dey
Gujarat and Rajasthan have been at the forefront of this growth, adding 1.43GW and 0.98GW in FY2024, respectively.
The report attributes this growth to the regulatory clarity brought in by the Green Energy Open Access Rules (GEOA), 2022. This, according to the report, has led to record annual installations between fiscal year 2023 and 2024.
“The Ministry of Power introduced the GEOA Rules to promote the generation, purchase and consumption of green energy to accelerate India’s renewable energy initiatives. By streamlining processes and reducing costs, the GEOA Rules have created a user-friendly and investor-friendly framework, driving momentum in India’s renewable energy sector,” said the report’s contributing author, Vibhuti Garg, Director – South Asia, IEEFA.
To boost investment in renewable energy projects, the Ministry of Power has also introduced exemptions on additional surcharges, which benefited offshore wind and green hydrogen projects.
Over the last two years, alongside the surge in installed capacity, the market has also seen new entrants.
“Consolidating regulations at both the central and state levels have created a more cohesive regulatory framework, fostering transparency and ease of operations,” said the report’s co-author, Prabhakar Sharma, Senior Consultant, JMK Research.
Despite the initial success of the GEOA Rules, some challenges persist, especially at the state level. “Deviations from the central GEOA Rules in certain states could hinder the prospects of the open access market. It is also important for states to focus on translating the rules into real development,” said Sharma.
Further, the report highlights that the adoption of the GEOA Rules among the targeted consumer bases, Micro, Small and Medium Enterprises (MSMEs) and small-scale C&I entities with less than 1 MWp contract demand has been disappointing.
“The GEOA Rules cannot be deemed a complete success unless green open access penetration among smaller consumers improves,” he added.
“Improved grid infrastructure will facilitate better project connectivity, expedite execution and reduce transmission costs,” stated Sharma.
“Future additions to the GEOA Rules are likely to incorporate provisions for emerging technologies like Inter-State Transmission System open access and power exchange-based projects. These amendments are vital to shaping the overall development of the green open access market,” he added.
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