solar projects are set to get a fillip with the introduction of the 'distributed renewable energy' segment in the latest renewable purchase obligations (RPO). This means that power distribution companies will have to mandatorily purchase renewable energy from rooftop solar projects among others included in the segment.
The government recently changed the mix of renewable energy sources for mandatory purchase by distribution companies and open-access consumers, while keeping the total obligation unchanged at 2022 levels.
Renewable energy projects with a capacity of less than 10 MW installed by consumers under any arrangement will qualify for renewable purchase obligation from the distributed renewable energy segment.
Discoms have been apprehensive of signing power purchase agreements for rooftop solar projects and installing the required net metering systems fearing loss of revenue from their high-paying consumers, financial viability of such projects and problems in sourcing finance. The implementation of green open access rules has also shifted the market attention, leading to state power regulators prioritising it over rooftop solar approvals, according to industry experts.