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Analysis of the legal framework for off-grid renewable energy sector in India

Student name: Ms Tripti Manral
Guide: Dr Gopal Sarangi
Year of completion: 2021

Abstract:

Against the backdrop of changing climate, limited resources, rising energy demands and defaults in the electricity sector, an approach towards responsible energy is a possible and sustainable solution in the long term.

Electricity is an essential part of basic human need and an integral part of socio-economic development of our country. The Indian power sector is facing many challenges to meet the rising electricity demand, not only in energy deficit states but also in the surplus states during peak season. Prioritizing the off-grid renewable sector in the mainstream could provide a better solution, as integrating renewable energy into the grid is a technical and financial challenge. The off-grid electrification based on renewable energy are significant towards achieving the objectives of Sustainable Development Goals (Goal 7 to attain accessibility, affordability for all through clean energy); National Determined Contribution (to mitigate the climate change) and UN Sustainable Energy for All (SE4ALL to complete universal electricity access by 2030).

However, the development of the off-grid sector has been declining due to the absence of sector-specific legislations and regulations regarding tariffs; performance standards; technical and environmental benchmarks for reliability and sustainability; and consumer empowerment. Also due to the lack of trust and reliability among the consumers and investors in the off-grid electrification, it is considered as a temporary solution. 

Using qualitative assessment, the research analysed the lacunas and efficacy of the existing regulatory frameworks for community level off-grid renewable systems in respect of providing tariff determination and grant of license (for generation and distribution) to balance the sustainability and affordability of the system. It examined the regulatory and monitoring mechanisms for ensuring that the service provider is following the standards of performance in supply and technical and environmental standards for the off-grid products for home systems as well as equipment for community systems. The study also explored the extent of recognition given to the consumers’ rights for electricity, grievances redressal and compensation at national and state levels. The study will also observe the scope of performance-based regulations, prepaid systems and independent regulators in the sector to develop clarity and transparency in the sector. The research also attempted to find out different combinations of interdependence of the abovementioned factors in the off-grid renewable energy sector.