Open Access Solar Power
USP: Supply of Solar Power directly to large/bulk users without having their own Solar Installation.
Note: This facility is only for Bulk power consumers whose Requirement is above 5 Mw. Large power consumers find this facility extremely profitable.
We are in touch with Solar Park Developers who generate a large quantum of Solar Power and offer it to bulk Power consumers on a Captive OR Group Captive basis. We can offer Hybrid Power which means a blend of Solar, Wind, and Hydropower.
The Solar power shall be generated at one point and delivered to another place thru the Grid which means the Utility board. The Grid levies a charge for using their way of Transport for the power.
It is advised to take power from the same state - else - wheeling charges of both states get levied and the price per unit becomes expensive. Within the same state, Solar power could be generated in one city and supplied to the user destination through the grid.
We can offer a price per unit lesser than the local discom tariff. A PPA needs to be signed ( Power Purchase Agreement) with a price per unit and tenure which is normally for 15 years. And further extendable.
For large industries whose power consumption is very high, this kind of power supply in Open Access is extremely beneficial as they can save a lot on their power bills. Without having to invest in their own Rooftop or ground-mounted solar installation.
Case Study of Steel Co for better commercial understanding
Power supply : 20 Mw
Location : Bellary - Karnataka
Current Discom Price : Rs.9 per unit
Power supplied at price : Rs.7 per unit
Savings per year : Rs. 8 Crores
Saving in 15 years : Rs. 120 Crores
Note: The price given is indicative it will change as per state location and availability of electricity in the state. It's guaranteed that the price to your company will be lesser than Discom.
Step 1: Your company will have to provide 6 months' electricity bills for all locations to understand power requirements.
Step 2: Non-circumvention agreement will be signed between MDV and your company
Step 3: MDV will identify the apt power suppliers in your state based on bills submitted by your company
Step 4: Once MDV identifies the apt power supplier for your state, MDV will submit a detailed techno-commercial proposal.
Step 5: Joint meeting with power supplier company (final negotiations at this stage)
Step 6: Signing of PPA with your company, power producer company, and MDV.
1. Is there any fixed rate that will be offered?
There is no - set price - per unit in this activity. It depends on a host of factors such as the - power required, power available, tenure for which power is required, minimum off-take per month, etc.
Based on the place where power is required and on the submission of the user's power bills of the local Discom, we can come up with a commercial offer for the user.
2. What is the process followed in this deal?
MDV analyses your bills and finds an apt power supplier. We check the best price supplier can offer at your location. Then we check with your company whether the price is acceptable to you. If yes, then we facilitate PPA between you and the power supplier.
There are two methodologies to get power one being captive and another is group captive mode.
3. What are captive and group captive?
A captive Generating plant means a power plant set up by any person, association, or any company to generate electricity primarily for his or her own use. A dedicated transmission line can also be built, operated, or maintained by the same person for the transmission of electricity produced out of such a captive plant.
A group captive scheme is where someone develops a power plant for the collective usage of many commercial consumers. At present, a power project is considered 'captive' if the consuming entity or entities consume at least 51% of the power generated and owns at least 26% of the equity. Various capital structures have evolved to qualify as a captive under the rules. For example, a major portion of the capital could be preference shares, with only a small portion being equity capital. Thus, owning 26% of the 'equity capital' actually translates to a very small amount relative to the overall investment in the project.
4. Is there any investment required from the company to avail of open access?
Yes, there will be some investment, but the investment will be much less than setting up your own plant. Investment depends on the location where the power is required, consumption, etc. Once 6 months' bills are analyzed, we will be able to give complete commercials.
5. What is MDV’s role?
MDV will identify the apt power supplier and facilitate the deal up to PPA. Drafting term sheets. (There are no upfront fees from MDV)
6. Does MDV have any charges for facilitating the deal?
Generally, MDV is covered by the power supplier side and there are no charges to the company, but in certain cases, MDV will charge success fees to the company, at the time of signing of the final PPA. It depends on rate negotiations; the success fee is transparent to your company and power supplier as it will be a tripartite agreement. (Note: Deal to deal MDV success charges vary)
7. If we are willing? What’s the next step after this document?
Providing 6 months bills to MDV
Signing a non-circumvention agreement with MDV