Choosing The Right Green Open Access Partner: A Guide For Corporations In India

July 5, 2023

With India experiencing a remarkable boom in renewable energy production, corporate and industrial (C&I) buyers are actively seeking ways to procure green power. In this article, we will explore the Open Access route to source green power, its advantages, and most importantly, provide valuable insights to assist C&I players in making informed decisions when choosing a power producer for Open Access Power.

The Booming Renewable Energy Industry in India:

India has firmly established itself as a global leader in renewable energy, ranking 4th worldwide in terms of generation capacity for both solar and wind. Boosted by the goal of achieving 500 GW of production capacity by 2030, the country’s renewable energy sector has witnessed tremendous growth, with a total generation capacity of 122 GW in February 2023, excluding large hydro and nuclear plants. As one of the largest renewable energy markets worldwide, India offers abundant opportunities for C&I players to embrace clean and sustainable power solutions.

Open Access Power & it’s Advantages:

Conventionally, the industrial consumers had no choice but to receive their electricity from the area DISCOM and have no influence over the price. The electricity act of 2003 has made it possible for customers with sanctioned loads of more than 1 MW to purchase electricity directly from generators, pay specific fees and taxes, and lower the cost of power. The Ministry of Power released Green Energy Open Access Policy in 2022 which enabled commercial and industrial sectors (C&I) with a consumption load less than 1 MW and more than 100 KW to procure power through the Open Access route.

For C&I players, Open Access provides an attractive alternative for procuring renewable energy due to the following reasons.

  • Permits & Approvals – Through Open Access, buyers can sidestep the regulatory complexities associated with permits, as the power producer assumes responsibility for all necessary approvals.
  • No Operational and Maintenance Hassles – C&I players can alleviate operational and maintenance concerns, as these aspects are also handled by the power producer.
  • Cost Savings – Open Access offers significant cost savings, potentially slashing power tariffs by approximately 30% over a span of 20-25 years.
What factors are the most important while selecting a RE Power Producer?

It is crucial for C&I players to understand that choosing a power producer in their renewable energy journey can significantly impact the success and long-term viability of their projects. By prioritizing these considerations, C&I players can make informed decisions that align with their unique requirements and contribute to a cleaner energy landscape in India.

  • Reliability and Track Record: Evaluate the power producer’s reliability and experience in delivering consistent power supply to ensure uninterrupted operations. Evaluating their track record, ongoing projects, and pipeline provides insights into their operational efficiency, scalability, and commitment to meeting timelines.
  • Project Status and Power Delivery Timeline: Understand the stage of the power producer’s projects and their ability to supply power promptly. Considering how quickly the power producer can supply power to the consumer is crucial for financial gains and uninterrupted operations.
  • Commercial Offer: Consider the pricing and cost structure along with the equity investment offered by the power producer, ensuring economic viability and long-term cost savings. Tariffs offered by the power producer strongly influence the ROI of the agreement.
  • Financial Strength: Assess the financial strength and stability of the power producer. This evaluation ensures that the power producer has the necessary financial resources to maintain project viability throughout the agreement’s lifespan. By partnering with a financially stable power producer, C&I players can mitigate risks, ensuring a reliable power supply and minimizing disruptions.
  • Contractual Terms and Flexibility: Review the contractual terms, including contract duration, pricing escalation clauses, and provisions for flexibility in energy procurement. By carefully examining these aspects, consumers of a Power Purchase Agreement (PPA) can mitigate risks and ensure long-term stability in their energy supply.
  • Capacity and Scalability: Assess the power producer’s capacity and scalability to meet varying energy demands, adapt to future needs, and accommodate expansion plans. Additionally, assess their flexibility to adapt to changes in your energy demand, potential expansions, or modifications in consumption patterns.
  • Technical Expertise and Support: Gauge the power producer’s technical expertise and ability to provide comprehensive support throughout the project’s lifecycle, including grid connectivity and operations.
  • Reputation and References: Conduct thorough research on the power producer’s reputation, seek references from existing clients, and assess their overall standing in the market.

Open Access Power Purchase Agreements (PPAs) have gained significant popularity due to their numerous advantages and their role in enabling companies to embrace sustainability. The growing recognition of Open Access is reflected in India’s remarkable progress, with the country adding a cumulative capacity of 2.5 GW in CY 2022, according to a report by Mercom India. This represents a remarkable increase of approximately 92% compared to the 1.3 GW installed in 2021. Against this backdrop, the question comes: Are your company stakeholders currently engaged in discussions with any power producer for signing a PPA? The adoption of Open Access PPAs can be a transformative step towards achieving your sustainability goals and reaping the benefits of renewable energy integration.

Sunsure Energy: Your Ideal Partner for Open Access PPAs

Choosing the right power producer plays a pivotal role in maximizing the return on investment for Open Access RE projects. Sunsure Energy emerges as a trusted and reliable partner in this space. With their comprehensive in-house capabilities, Sunsure handles all aspects of the project, from land acquisition to grid connectivity to plant setup, ensuring a seamless and hassle-free experience. Boasting an impressive installed capacity of over 300 MWs, with an additional 1.1 GW currently under construction, Sunsure Energy showcases their commitment to scalability and renewable energy generation. Having served 60+ corporations across 16 Indian states, Sunsure Energy boasts a track record of quality and on-time power delivery.

With a private equity investment of $400 million USD from Partners Group, Sunsure Energy offers financial stability and long-term viability for Open Access PPAs. By partnering with Sunsure, C&I players can confidently navigate the Open Access landscape, securing a sustainable and cost-effective power supply for their operations.

In conclusion, C&I players in India have various options to procure renewable energy, with Open Access being an attractive route due to its regulatory advantages, cost savings, and operational simplicity. When selecting a power producer, evaluating factors such as reliability, capacity, sustainability, pricing, contractual terms, technical expertise, and reputation is crucial. Sunsure Energy stands out as an ideal partner, offering in-house capabilities, substantial installed capacity, strong financial backing, and a commitment to clean energy. By partnering with Sunsure Energy, C&I players can navigate the Open Access landscape with confidence and secure a sustainable and cost-effective power supply for their operations.

Shantanu Faugaat

Co-Founder, Director & COO at Sunsure Energy