TNERC Proposes Amendments To Strengthen Grid Stability And Deviation Settlement Mechanism

Posted On - 30 November, 2024 • By - King Stubb & Kasiva

Introduction

The Tamil Nadu Electricity Regulatory Commission (TNERC) has proposed amendments to its 2019 Deviation Settlement Mechanism (DSM) regulations, aiming to strengthen grid stability and address issues stemming from increasing renewable energy penetration.[1] These changes are crucial for ensuring the reliability and efficiency of the state’s power grid, especially given the unpredictable nature of renewable energy sources like wind and solar. The amendments are designed to refine penalties for grid imbalances, improve the frequency range for grid operations, and align Tamil Nadu’s DSM regulations with national standards.

Explanation (Key Points)

  1. Applicability and Scope
    The proposed amendments will apply to all buyers and sellers of electricity involved in transactions through Open Access using the intra-state transmission system. This includes state-owned generating stations, but excludes wind, solar, and hydroelectric stations linked to irrigation. One notable change is that Open Access consumers connected to the transmission or distribution systems will be included in the DSM framework at a later date​.
  2. Frequency Operating Range
    The amendments propose stricter control of the grid’s frequency operating range. Under the new regulations, no deviations will be allowed outside the frequency range of 49.90 Hz to 50.05 Hz, which aligns with the Indian Electricity Grid Code (IEGC). This tighter frequency control is essential to maintain grid stability, especially as fluctuations can cause power outages or equipment damage​.
  3. Deviation Charges and Penalties
    The updated regulations include more stringent penalties for sellers and buyers who fail to adhere to their scheduled energy drawals and injections. The changes introduce a requirement for entities to correct their deviations within six consecutive time blocks. If this correction is not made, a 20% additional charge will be imposed on top of existing deviation charges​(76rQjg977sNhJGXpa1VkeXf…). Furthermore, the amendments remove the cap rates on deviation charges for generating stations, thereby discouraging intentional grid imbalances, also known as “gaming,” and aligning the rates with those of the Central Electricity Regulatory Commission.
  4. Settlement Period and Loss Allocation
    Another key amendment is the proposal to undertake settlement of DSM accounts on a weekly basis, with the data published on the website of the State Load Despatch Centre (SLDC). Additionally, transmission and distribution losses for state entities will be calculated based on each time block, further encouraging accurate scheduling and penalizing deviations​.
  5. Increased Transparency and Compliance
    The SLDC will be responsible for publishing weekly records of deviation accounts, specifying over-drawals and under-injections along with the corresponding deviation charges. This will ensure transparency and compliance among market participants​. Moreover, the amendments also address the issue of gaming by specifying penal charges for intentional misdeclaration of power schedules, thereby curbing market manipulation​.
  6. Renewable Energy Integration and Grid Security
    With the rapid increase in renewable energy generation, grid security has become a significant concern. The amendments aim to link the DSM framework with real-time market prices to bring discipline in managing the intermittent nature of renewable energy. By narrowing the frequency bands and imposing stricter penalties, the amendments will help maintain grid stability and minimize the negative impacts of fluctuations in renewable energy generation​.

Conclusion

The proposed amendments by TNERC represent a comprehensive approach to improving grid stability in Tamil Nadu. They address the challenges posed by the growing penetration of renewable energy and enhance the efficiency of the Deviation Settlement Mechanism. By tightening control over grid frequency, revising penalties, and improving transparency, the amendments aim to promote a more disciplined and secure electricity market. These changes are crucial for ensuring that Tamil Nadu’s grid can cope with the evolving demands of modern energy systems, particularly in the context of India’s broader push towards renewable energy.

[1] https://www.energetica-india.net/download.php?seccion=news&archivo=76rQjg977sNhJGXpa1VkeXfYDGrwnPavdFkqG9iuwonPL7MoBYkrd9a.pdf