MERC Drafts 2026 Open Access Rules, Proposes Storage Mandate

The Maharashtra Electricity Regulatory Commission (MERC) has proposed changes to the state’s framework governing distribution open access, intra-state transmission connectivity and general network access, including mandatory energy storage requirements for renewable energy projects, revised green energy open access eligibility and a time-slot-based mechanism for banking renewable electricity.

The proposed regulations seek to align the regulatory framework with Maharashtra’s Renewable Energy and Energy Storage Policy 2025–26 to 2035–36. The draft provisions cover energy storage systems (ESS), connectivity requirements, solar-hour access, connectivity bank guarantees, changes in renewable energy sources, open access eligibility, network charges, banking and standby charges, settlement periods and transition arrangements.

Under the proposed framework, applicants seeking connectivity for variable renewable energy sources such as solar and wind would be required to install an ESS meeting one of two conditions. The first option would require storage equivalent to at least 50 percent of the applied connectivity capacity, with a minimum discharge duration of two hours. The second option would require storage with a power rating of at least 25 percent of the applied connectivity capacity and a minimum discharge duration of four hours.

The draft also proposes a minimum usable storage capacity of 1 MWh per MW of sanctioned connectivity for applications up to 2030. This requirement would increase to 2 MWh per MW thereafter. The proposed storage provisions would apply from the publication date of the regulations, including to pending applications for which in-principle connectivity approval has not been issued.

For co-located hybrid projects, applicants could seek connectivity equal to the highest installed capacity among the renewable energy sources or the ESS. Non-co-located hybrid projects would be required to apply separately for connectivity at each point of connection to the intra-state transmission system (InSTS). Renewable energy generating stations and ESS projects would also be permitted to add renewable generation or storage capacity within their sanctioned connectivity quantum, subject to prior approval from the nodal agency. Capacity owned by another entity could also be added under the provision.

MERC has proposed defining solar hours as the period from 7 am to 6 pm, until further notification by the Commission. Under solar-hour access, entities would have injection scheduling and drawal rights during these hours but would not have injection and scheduling rights during non-solar hours.

Existing or approved connectivity based on solar generation, including specified renewable energy projects and renewable power procurement arrangements, would be converted to solar-hour access within six months of the regulations coming into effect. Such entities could apply for full-day access within the prescribed six-month period under the relevant provisions.

The draft would also allow eligible connectivity applicants to change their renewable energy source, wholly or partly, while retaining the same connectivity quantum. The application would have to be made within 18 months of the grant of in-principle connectivity or 18 months before the effective date of general network access, whichever is later. A change of source would be permitted only once and would be subject to the availability of non-solar-hour access. Existing and proposed connectivity holders would also be permitted to augment project capacity by adding solar, wind or battery energy storage behind the existing connectivity point.

The proposed framework specifies connectivity bank guarantees at different stages. Conn-BG1 for renewable energy projects would be INR 5 lakh, while Conn-BG2 would depend on the voltage level of the allocated terminal bay, ranging from INR 0.5 crore for 33 kV to INR 12 crore for 765 kV. Conn-BG3 would be INR 2 lakh per MW for the existing intra-state transmission system and augmentation without associated transmission system requirements.

Conn-BG1 would be returned within 30 days of the declaration of commercial operation of the full sanctioned capacity. Conn-BG2 and Conn-BG3 would be returned in five equal parts over five years, corresponding to the generation capacity declared under commercial operation.

The draft proposes that consumers with a contract demand or sanctioned load of at least 100 kW would be eligible to seek green energy open access. Consumers with multiple connections aggregating at least 100 kW within the same electricity circle of a distribution licensee would also qualify. Consumers sourcing renewable power from generators would be permitted to procure capacity of up to twice their contract demand or sanctioned load.

The proposed regulations define long-term open access as access exceeding 11 months and extending up to 25 years, while short-term open access would cover periods ranging from one day to 11 months. The State Transmission Utility would serve as the nodal agency for long-term open access, while the State Load Despatch Centre (SLDC) would handle short-term access. Long-term open access grantees would be permitted to schedule power under any contract within their granted access, subject to the conditions specified in the State Grid Code.

MERC has also proposed exemptions from specified network charges for ESS connected to the intra-state transmission or distribution network and drawing electricity solely for intermediate storage. The exemptions would cover intra-state transmission charges, demand charges, wheeling charges, cross-subsidy surcharge and additional surcharge. The proposed relief would apply where the energy stored is consumed within Maharashtra.

For renewable energy-based long-term and short-term open access transactions, transmission charges would be payable on a rupees-per-kW-per-month basis, as determined by the Commission through tariff orders. The draft also lists applicable wheeling charge and wheeling loss categories for consumers connected through MSEDCL, Tata Power Company and Adani Electricity Mumbai Limited. The specific approved charge and loss values are not stated in the supplied draft extract.

A key feature of the proposed framework is a time-slot-based renewable energy banking mechanism linked to the cumulative contracted renewable energy capacity of consumers. Consumers with contracted renewable capacity of 10 kW to 100 kW would have four daily banking slots of six hours each. The framework proposes eight three-hour slots for capacity between 0.1 MW and 1 MW, 12 two-hour slots for capacity between 1 MW and 5 MW, and 24 one-hour slots for consumers with more than 5 MW of contracted renewable capacity.

The draft proposes fixed banking and standby charges in INR per kW per month, along with variable charges in INR per kWh for energy banking across different time slots. Fixed charges would reflect the cost of maintaining conventional generation capacity and standby support, while variable charges would account for the cost of shifting stored energy across slots.

For consumers with time-of-day tariffs, banked energy would first be adjusted against slots carrying the highest energy charges. Consumers with contracted renewable capacity of 5 MW or more would face a cap on the adjustment of banked energy. In any slot, the adjustment could not exceed 10 percent of their consumption from the distribution company during that slot.

The draft also proposes a transition to 15-minute scheduling for consumers above 5 MW within three years. For consumers with contracted renewable capacity exceeding 3 kW, unused banked energy would lapse at the end of the applicable settlement period, with renewable energy certificates to be issued to the generator for the lapsed energy. Consumers would be permitted to change their electricity supplier once per calendar month, subject to SLDC approval.

Consumers that have already availed banking, or applied for it under the existing open access framework before notification of the proposed regulations, would have a one-time option to continue under the MERC Distribution Open Access Regulations, 2019, along with related amendments and orders, until their open access agreements expire. Alternatively, they could opt for the proposed banking framework. However, consumers augmenting their existing open access renewable energy capacity would be required to migrate to the new framework.

The draft further states that provisions governing banking settlement periods, renewable energy capacity-based banking slots, and banking and standby charges would remain fixed for the duration of the open access contract with the distribution licensee. Existing open access contracts would remain valid until the end of their respective terms.

The working group constituted by MERC to recommend changes in the regulatory framework in line with Maharashtra’s Renewable Energy and Energy Storage Policy 2025–26 to 2035–36 has estimated a fixed banking and standby charge of INR 139 per kW per month for the base case. Its analysis indicates that the variable banking and standby charge could tentatively range from INR 3 to INR 4 per unit, based on market-discovered tariffs and prevailing storage costs. These figures form part of the proposed framework and are not final notified charges.

The draft provides that applications for connectivity and distribution open access received after publication of the draft would be processed under the existing regulations. However, approvals granted under the existing framework would become subject to the new provisions once the draft regulations are notified. MERC would also be empowered to issue orders and practice directions concerning implementation.

The proposed regulations are part of MERC’s regulatory process and are not yet in force. If notified in the proposed form, the framework would change requirements for renewable energy grid connectivity, storage integration and open access banking and settlement in Maharashtra.