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The Central Electricity Authority (CEA) has introduced a new procedure to verify the captive status of generating plants where the captive generating plant (CGP) and its captive users are located in different states. This initiative follows an amendment issued on September 1, 2023, under the Electricity Rules, 2005, and aims to streamline the verification process for captive power generation. The procedure is effective from the financial year 2024-25 and applies to all power plants and consumers seeking captive status verification. The verification process ensures compliance with Rule 3 of the Electricity Rules, 2005, which outlines the requirements for a generating plant to qualify as a captive generating plant. According to these rules, a CGP must be primarily used for self-consumption, with at least 26% ownership held by captive users and at least 51% of the electricity generated consumed by these users. In cases where a company forms a special purpose vehicle (SPV) for power generation, the proportionate equity shareholding and electricity consumption requirements apply to specific generating units rather than the entire plant. The CEA has defined various terms relevant to captive generation, including single captive users, group captive users, renewable hybrid generating stations, and energy storage systems. The verification process will be overseen by the Director of the Legal Division at CEA, who is designated as the Verifying Authority. The authority will ensure that CGPs located in one state and their captive users in another meet the stipulated requirements. If compliance is not met, the electricity generated will be treated as if it were supplied by a non-captive generating company. The procedure includes general conditions that must be satisfied for verification, such as the minimum ownership threshold of 26%, which must be maintained throughout the financial year. In cases where ownership changes during the year, the weighted average shareholding will be considered to determine compliance. Similarly, for group captive users, the proportional consumption requirement must be met within a variation of 10%. If any user fails to meet this proportionality test, the entire group may lose captive status. The verification process requires applicants to register their units with the e-Gen portal of CEA and submit applications by May 31 each year. The application must include ownership details, financial records, and authenticated data on electricity generation and consumption. The State Load Dispatch Centers (SLDCs), Regional Load Dispatch Centers (RLDCs), and distribution licensees will assist in verifying actual generation and consumption data. CGPs located within industrial premises must submit monthly consumption reports to the relevant distribution licensee. The procedure also specifies metering requirements, mandating real-time communication facilities with SLDCs and RLDCs for both CGPs and their users. If an energy storage system (ESS) is used, it must either be classified as a generating system or a storage system at the beginning of the financial year. Losses incurred during energy storage will be considered in consumption calculations. For cases where multiple generating plants share a single interface with the transmission network, each plant must submit a separate verification application. Additionally, a Qualified Coordinating Agency (QCA) must provide authenticated generation data for all plants at the interface point. If a CGP or user disagrees with the verification outcome, they may appeal to the Chief Engineer of the Legal Division at CEA within 30 days. A second appeal can be made to a committee comprising senior CEA officials, which will make the final decision. This verification procedure ensures that captive power generation remains transparent, compliant with regulations, and efficient in serving industries and businesses that rely on self-generated electricity. The structured approach will help in maintaining grid stability and ensuring that captive power plants operate within the regulatory framework. |
