Energy Policy: A Win-Win Tariff for CEB and Large Consumers

The Carbon Neutral Renewable Energy Scheme, introduced by Minister Patrick Assirvaden, provides large companies and institutions the opportunity to inject surplus electricity, adopt solar solutions, and better manage consumption during peak hours.

Yesterday, Minister of Energy Patrick Assirvaden announced the launch of a new Carbon Neutral Renewable Energy Scheme, specifically targeting large electricity consumers. This includes shopping malls, large hotels, major corporations, as well as banks and insurance companies. This initiative aims to encourage investment in renewable energy and energy efficiency while supporting electricity consumption management during peak hours.

Until now, these energy-intensive consumers had no obligations or financial incentives to adopt more sustainable energy solutions. Unlike the manufacturing sector, these companies were not eligible for the Time-of-Use (TOU) tariff, which varies based on the time of day and encourages reduced consumption during high-demand periods.

However, an experiment conducted in the manufacturing sector demonstrated the effectiveness of this approach. By introducing the TOU tariff and the Carbon Neutral Renewable Energy Scheme, authorities observed a significant influx of investments in photovoltaic solar projects, with over 100 MW currently under development. This success convinced the government to expand this strategy on a larger scale.

The New Program

The program includes several measures designed to facilitate the adoption of renewable energy solutions by large companies. They will now have the option of choosing between gross metering or quasi net metering. The program will also allow the installation of solar systems, whether on-site or off-site, up to 150% of the company's annual electricity needs.

One of the key points of this program is the improvement in compensation for surplus electricity. Companies that inject surplus energy into the Central Electricity Board (CEB) network will receive Rs 4.20 per kWh, compared to Rs 1.86 currently.

Another key innovation of the program is the requirement to install Battery Energy Storage Systems (BESS). These systems will store surplus electricity produced during low-demand periods for reinjection into the grid during peak hours, between 6 PM and 9 PM. This mechanism will help alleviate pressure on the national grid and ensure more effective electricity distribution management.

In its initial phase, the CEB plans to integrate 70 MW of solar capacity, accompanied by at least 11.5 MW / 46 MWh of battery storage, for commercial consumers affected by tariffs 225 and 225A. Participation in the program will be voluntary for the first 12 months.

Extension to Other Sectors

This initiative is seen as an important first step, paving the way for a possible extension to other categories of high electricity consumers. The goal is to reduce carbon footprints while ensuring greater sustainability and resilience of the national electricity grid.

Key Points of the Program:

• Higher electricity costs between 6 PM and 9 PM: consumers can benefit from better rates starting at 9 PM.
• Injection of surplus electricity: large companies will have the opportunity to inject surplus electricity into the CEB network using battery storage systems.
• Increased compensation for surplus electricity: companies will now receive Rs 4.20 per kWh, compared to Rs 1.86 currently.
• Requirement to install battery storage systems: these devices will facilitate grid management, especially during peak hours.