Policy Submission| Draft Electricity Amendment Bill 2020

By Shilpi Samantray & Snehil Singh

Background

The reformation of the power sector will not only be transformative for India’s rapid economic development and transition to clean energy but also pave the way for a more self-reliant India.

Ola Mobility Institute congratulates the Ministry on releasing a robust and ambitious Draft Electricity Amendment Bill 2020 dated 17th April 2020 towards transforming India’s power sector. OMI is pleased to have the opportunity to submit a few recommendations for the ministry’s consideration especially for accelerating India’s journey towards clean mobility.

Recommendations

I. Allow Aggregation of Open Access Electricity

1. Allow aggregation of open access electricity wherein buyers (such as app-based aggregators) should be able to pay for the renewable energy they consume. This could be facilitated by allowing access to private players such as mobility service providers to set up solar farms at a subsidised cost.
2. Provide an exemption to maintain contracted demand. Today, there is a requirement to maintain a minimum threshold of 1 megawatt of power on standby to contract open access electricity. This requirement of a minimum threshold on contract demand especially for EV charging should be removed to provide opportunity for small players to participate and ensure competition.
3. In order to make open access successful for EV charging through clean sources like solar, the focus should be on relaxing the open access charges i.e. the cross-subsidy surcharge. Buyers are often burdened with high open access charges and the additional charges imposed by the State Electricity Regulatory Commission (SERC). Reduction in the open access charges will enable buyers to procure electricity at reasonable rates to ensure optimum power supply efficiently.

II. Access to Renewable Energy

4. The Draft Amendment Bill rightly encourages the adoption of renewable energy to power electric vehicles. However, to ensure smooth and rapid uptake to renewable energy by the market players, the government should also enable and encourage states to create necessary infrastructure in the form of net metering and banking facilities, among others, to measure the energy derived from renewable sources. Experience from the country’s first multimodal electric mobility project by Ola shows that solar net metering reduced electricity bill by 28% and contributed to improved economic viability. Globally, in countries such as Germany, the Netherlands and US, robust net metering arrangements have shown to benefit consumers through renewable energy installations, making the best use of battery systems.

5. Under section 3A of the Draft Amendment Bill, National Renewable Energy Policy is introduced. As per the Electricity Act, 2003, the government has already proposed a National Electricity Policy and National Electricity Plan of which renewable energy was a sub-component. As renewable energy needs to be integrated with the power sector, it should not be seen as a different policy. Instead of having a separate policy, renewable energy should be integrated with the National Electricity Policy for effective resource planning, storage efficiency and better implementation and grid management.

III. Battery Storage Solutions

6. Electric Vehicle fleets have an immense potential for electricity storage capacity which can be maximized by using smart charging approaches. Therefore, many state electricity boards are looking at the EV category as an option for generating demand during off-peak hours. State-level EV policies specify ToD tariff provisioning for peak load shaving and load balancing of the grid. Ola Electric’s experience from Nagpur shows that 63% of charging happens in afternoon (12pm-4pm) and evening (8pm- 12am). Further, charging technologies such as battery swapping hold vast potential to avoid peak-load on the grid by making optimum utilisation of operational hours. As batteries hold the key to transitioning away from fossil fuel dependence, they are set to play a greater role in India’s clean energy transition. The Government should, thus, incentivise the installation of battery and energy storage solutions at charging stations. In the absence of storage, fast chargers might become non-functional due to voltage fluctuations, as was witnessed in Nagpur. A clear policy framework on energy storage should be included in the draft. This will help to enable EV charging infrastructure, vehicle to grid charging, integration of microgrids, etc in the long run.

References