CSERC Drafts Intra-State Deviation Settlement Regulations 2025 To Ensure Grid Stability And Fair Energy Practices

Posted On - 7 February, 2025 • By - King Stubb & Kasiva

Introduction

The Chhattisgarh State Electricity Regulatory Commission (CSERC) has introduced the draft Intra-State Deviation Settlement Mechanism (DSM) and Related Matters Regulations, 2025. [1]These regulations, set to be effective from April 1, 2025, aim to enhance grid stability and ensure equitable energy practices among market participants. By enforcing strict adherence to scheduled energy drawl and injection, CSERC seeks to maintain the security and efficiency of the state electricity grid. The regulations cover all intra-state and inter-state entities connected to the State Transmission Utility (STU) and introduce a structured deviation settlement process.

Key Provisions and Explanation

1. Applicability and Objective

The primary objective of the regulations is to create a commercial mechanism ensuring that grid users comply with their scheduled electricity drawl and injection, thereby preventing system imbalances. These regulations apply to generating companies, captive power plants, distribution licensees, and open access consumers who draw power from the state grid.

2. Deviation Settlement Mechanism (DSM)

The DSM is structured to penalize deviations from scheduled drawl or injection of power to prevent grid instability. The settlement mechanism applies to all intra-state entities, including renewable energy generators, distribution licensees, and open-access consumers.

Deviation Calculation and Charges

  • Deviation for Sellers: Calculated as the difference between actual injection and scheduled generation.
  • Deviation for Buyers: Computed as the difference between actual drawl and scheduled drawl.
  • Normal Rate of Charges: Charges for deviation are based on frequency variations and market rates.
  • Renewable Energy (RE) Generators: Wind, solar, and hybrid RE generators have separate deviation limits and penalties.
  • Hydropower and Biomass Plants: Subject to distinct deviation charges without direct frequency linkage.

3. Availability-Based Tariff (ABT) Mechanism

Under the ABT mechanism, electricity tariffs are divided into:

  • Fixed Charges: Linked to the declared availability of the generating station.
  • Energy Charges: Based on scheduled energy consumption.
  • Deviation Charges: Applied when actual generation or consumption deviates from scheduled values.

4. Scheduling and Dispatch Procedures

  • Long-term and Medium-term Open Access Users: Scheduling follows CSERC Open Access Regulations, requiring declarations by sellers and buyers.
  • Short-term Open Access Transactions: Scheduling approvals must be obtained at least seven days before the supply date.
  • Revisions: Limited revisions are permitted for declared capacity and drawl schedules.
  • Grid Stability Measures: In case of frequency deviations or transmission congestion, SLDC has the authority to modify schedules.

5. Energy Accounting and Billing

  • Settlement of Energy for Open Access Consumers: Consumers with multiple sources of power are billed based on deviation from scheduled drawl.
  • Settlement for Renewable Energy Generators: Renewable generators under 5 MW have distinct settlement provisions, including banking mechanisms.
  • Billing Cycles: DSM billing is conducted weekly for general sellers and monthly for renewable energy and hydro generators.

6. Creation and Management of Deviation Pool Account

To ensure transparent deviation settlements:

  • State Load Dispatch Centre (SLDC): Responsible for computing and issuing DSM bills.
  • State Deviation Pool Account: Maintained by Chhattisgarh State Power Distribution Company Ltd. (CSPDCL) to handle payments and settlements.
  • Letter of Credit (LC) Requirement: Entities with recurring payment defaults must open an LC for 110% of their average deviation charges.
  • Interest on Late Payments: A penalty of 0.04% per day for delayed payments beyond the stipulated time frame.

Conclusion

The CSERC Intra-State Deviation Settlement Regulations, 2025, introduce a structured mechanism to balance power generation and consumption within the state grid. By enforcing adherence to scheduled energy transactions, these regulations aim to minimize deviations that can lead to grid instability. Additionally, the framework ensures fair energy pricing and equitable treatment of renewable and conventional energy producers. With robust energy accounting and strict penalties for non-compliance, the DSM framework is expected to promote efficiency and sustainability in Chhattisgarh’s electricity market. These measures will play a crucial role in maintaining grid discipline and promoting a stable energy ecosystem in the state.

[1] https://cserc.gov.in/upload/upload_news/28-12-2024_1735400657.pdf