SOLAR POWER POLICY

FRAMEWORK FOR THE

STATE OF TELANGANA
GLOSSARY

COD Commercial Operations Date

CII Confederation of Indian Industry
GoTS Government of the State of Telangana
GoI Government of India
MNRE Ministry of New and Renewable Energy
MoP Ministry of Power
NCE Non-Conventional Energy
NOC No-Objection Certificate
NSM National Solar Mission
PCB Pollution Control Board
PPA Power Purchase Agreement
PV Photo Voltaic

GLOSSARY
R&D Research & Development
REC Renewable Energy Certificate
RPPO Renewable Power Purchase Obligation
RLDC Regional Load Dispatch Centre
SGST State Goods Service Tax
SLDC State Load Dispatch Centre
SPC Solar Policy Cell
SPP Solar Power Project
SPV Special Purpose Vehicle
SRP Solar Roof-top Project
Scheduled Consumers As defined in Regulation 2 of 2006
TNREDCL Telangana New and Renewable Energy Development Corporation Limited
TSDISCOMS/DISCOMS Distribution Companies of the State of Telangana
TSPCB Telangana State Pollution Control Board
TSNPDCL Telangana State Northern Power Distribution Company Limited
TSSPDCL Telangana State Southern Power Distribution Company Limited
TSTRANSCO Telangana State Transmission Corporation
TSERC Telangana State Electricity Regulatory Commission

01
 K. CHANDRASEKHAR RAO Hyderabad

Chief Minister
Telangana

MESSAGE
The State of Telangana, formed on June 2, 2014, is the youngest state in the country. We took upon
ourselves the daunting task of tiding over the power shortage, which was inherited at the time of formation of the
state. It is our vision to make the state not only self-sufficient in power in the shortest possible time but also to
ensure provision of reliable and quality power to all consumers in the state on a sustainable manner at an
affordable cost.

We have been able to ensure an un-interrupted power supply situation, to the amazement of one and all,
from January 2015 onwards till date, by undertaking meticulous planning and having short and medium term
power purchase agreements. The state has come out with its “New Industrial Policy 2015” and renewed interest
of investors in industry and manufacturing implies higher requirement of power in coming years. The state has
finalized a detailed road map to add capacity in thermal power generation through its own agencies such as
TSGENCO & SCCL as well as NTPC and will be self-sufficient from 2016 onwards .

Emphasis on renewable energy sources, especially Solar Power, and making it an integral part of our
overall energy policy thus comes naturally. Given the abundance of solar energy potential in the state, we plan to
add least 5000 MWs of solar power in next four years. It is in this backdrop that a well thought out Solar Policy is
crucial.

The role of power in economic development is well established and it is our endeavor to ensure that solar
potential in the state is environmentally harnessed to its maximum potential.

“Telangana Solar Policy 2015” addresses all major concerns of potential investors such as a single
window clearance, easing permissions regime, cutting down on delays, especially those related with land
conversion &land ceiling and providing various fiscal & non-fiscal incentives. The policy also encourages solar
rooftops, pump sets and off-grid generation as well.

I am very confident that this Policy would attract interest and investment from both internal and foreign
entrepreneurs.

(K. CHANDRASEKHAR RAO)

02
G. JAGADISH REDDY Room No. 237, 1st Floor, D-Block,
Hon’ble Minister for Energy, Telangana Secretariat, Hyderabad
Govt. of Telangana State
Phones: 040-23450520 [O]
040-23453212

MESSAGE
Government of the State of Telangana (GoTS) recognizes the critical role which power sector plays in the
socioeconomic development of the State. It is the objective of State government to provide quality, reliable and
affordable power to all in the State of Telangana.

GoTS is working closely with Ministry of Power (MoP) in formulating the 'Power for All' programme in the
State of Telangana which aims at providing reliable 24 x 7 power in the state. GoTS is working on arrangements for
providing 9 hours of supply to agricultural consumers from FY 2016-17. This requires harnessing all new sources
including solar power.

Telangana has a vast solar potential with average solar insolation of nearly 5.5 kWh/m2 for more than 300
sunshine days. GoTS is keen on tapping this potential and has decided to go in a big way to tap it effectively. We
have been successful in signing PPAs with solar project developers to the extent of 515 MW through competitive
bidding process concluded in Feb 2015. GoTS intends to tap a further 2000 MW of solar capacity through
competitive bidding and this procedure is currently under process. The response of solar developers has been
very encouraging.

'Telangana Solar Power Policy – 2015' has been formulated after consultations with a wide range of
stakeholders. This policy aims at improving significantly the ease of doing business and also has attractive
incentives for the solar power developers.

I am sure that this policy will provide a strong impetus to the solar power capacity additions in the State of
Telangana, with its futuristic & progressive approach.

(G. JAGADISH REDDY)

03
 PREAMBLE
In the last decade, due to increasing thrust of Governments across the world towards fuel
conservation and clean energy, solar power capacity has increased by over 45 times and
stands at about 184 GW in 2014. In India, capacity additions in solar power have been even
more remarkable. In contrast to mere 10 MW in 2010, total solar capacity in India has grown to
nearly 3000 MW in 2015.
Growth rate in solar capacity has been accompanied by rapidly declining cost curves. Solar
PREAMBLE

system costs have come down by nearly 70% in the past five years owing to technological
advancements resulting in lower manufacturing and processing costs. In India, solar power
prices discovered through competitive bidding have come down by more than 50% in the last
four years.
Across the globe, about 7,200 gigawatts (GW) of capacity needs to be built to keep pace with
increasing electricity demand while also replacing existing power plants due to retire by 2040.
The strong growth of renewables in many countries raises their share in global power
generation to one-third by 2040.
Government of India (GoI) has set for itself an ambitious target of increasing solar capacity to
100 GW by 2022 and 200 GW by 2050. In order to achieve these targets, GoI is implementing
a wide range of regulatory and policy interventions. It is estimated that utility-scale grid parity
is expected to be achieved faster than originally estimated and solar power will start
aggressively competing with conventional power by 2017
Telangana has a vast solar potential with average solar insolation of nearly 5.5 kWh/m2 for
more 300 sunshine days. Government of the State of Telangana (GoTS), intends to make use
of the positive environment in solar market and push given by GoI for substantially harnessing
the solar potential in the State of Telangana.
This policy of GoTS on solar has provisions which aims at creating an enabling environment
for prospective solar power developers to harness substantial quantum of solar power in the
best possible manner. This in turn is expected to meet the objective of GoTS to provide
competitive, reliable power supply to its consumers and also to ensure a sustainable fuel mix
in the long run.

TITLE
The policy shall be known as “The Telangana Solar Power Policy 2015”.

04
 OBJECTIVES

U Realize and harness the vast solar power potential of the state.
U Contribute to long-term energy security of the state and promote a
This sustainable fuel mix in generation through higher contribution of
Solar Policy solar energy.
has the
U To promote solar parks.
following
specific U To promote public as well as private investment in solar power
objectives: generation.
U To promote decentralized and distributed generation.
U To promote grid-connected and off-grid solar applications and
effective energy conservation measures.
U To promote all technologies of harnessing solar energy.

OPERATIVE PERIOD

OBJECTIVES
This policy shall come into operation with effect from the date of issue and shall remain
applicable for a period of five (5) years. All Solar Projects that are commissioned during the
operative period shall be eligible for the incentives declared under this policy, for a period of
ten (10) years from the date of commissioning - unless otherwise the period is specifically
mentioned.

APPLICABILITY OF THE POLICY

This solar policy shall be applicable for the following solar projects set up within the state-
1) Solar Power Projects (SPPs)
a) Grid connected solar power projects based on both Photo Voltaic (PV) as well as
Solar Thermal technologies
u Projects set up for sale of power to TSDISCOMS
u Projects set up for sale of power to third parties within the state
b) Projects set-up for captive generation/group captive generation (including
those funded and owned by the developers)
2) Solar Roof-top Projects (SRPs) ( Grid-connected and off-grid ) – This includes
projects which are funded and owned by developers
3) Off-grid applications
4) Any other project which is established based on MNRE/GOI Schemes as amended
from time to time.
5) Solar Parks

05
 SOLAR PARKS
For availing benefits under this policy, power generated from any of the above modes, has to
be consumed within the state.
Demand-side management through energy conservation is integral to energy security.
Hence, this policy aims not only at promoting grid connected projects but also promoting off-
grid solar projects/applications.

REGULATORY FRAMEWORK
The Electricity Act 2003, as amended from time to time, mandates the State Electricity
Regulatory Commission, to set tariffs for renewable energy as well as to issue regulations
pertaining to renewable power purchase obligation (RPPO), and set charges for wheeling,
transmission and distribution of electricity.

SOLAR PARKS
The Solar Park is a concentrated zone of development of solar power projects, which
provides developers an area that is well characterized, properly infra-structured, and where
the risk of the projects can be minimized as well as the facilitation of the permitting process.
Solar Park implementing agency would be formed by State Government along with
designated central agency and private sector participation or independently by private
sector.
The Solar Park implementing agency will help facilitate in development of supporting
infrastructure and facilities including power evacuation, water arrangements, internal roads
and administrative facilities.
These Solar Park(s) will host an array of players in the solar power sector including solar
power plants, component manufacturers, R&D centres, training centres, and financial
institutions. The State of Telangana will extend all facilities and fiscal incentives provided by
Central Government/ National Solar Mission to the manufacturers and other participants in
Solar Parks.

06
 SOLAR ROOF-TOP PROJECTS
The Government of Telangana is committed
to promotion of solar roof-top systems on
public buildings, domestic, commercial and
industrial establishments.
All incentives provided by the GOI/MNRE
under the NSM or other schemes and
incentives provided by state government
from time to time shall be extended to grid
connected SRPs as well as off grid SRPs.
The following additional support shall be
available to grid connected SRPs as per the
capacity limit as defined by MNRE from
time to time.
The consumers are free to choose either net
SOLAR ROOFTOP

or gross meter option for sale of power to

the DISCOMs under this policy. The tariff
applicable for units generated under gross
metering at 11 KV and below would be
average cost of service of the DISCOM as
determined by TSERC. The tariff applicable
for units under net metering would be
average pooled power purchase cost.
Projects under both gross and net metering
would be subject to monthly billing and
settlement.
No distribution losses/charges shall be applicable for SRPs.
Consumer installing grid connected SRPs shall apply online with the respective TSDISCOM
either on website/through designated customer service centres. All applications shall be
processed and feasibility issued by the
respective DISCOM. Such applications will
be processed within 21 days from the date
The consumers are free to of application failing which it will be deemed
choose either net or gross to have been approved.
meter option for sale of power The above facility of gross and net metering
to the DISCOMs under this would be extended to SRPs for a period of
policy. The tariff applicable for 25 years. The project size at a single
units generated under gross location would be subject to technical
constraints. The modalities of implementing
metering at 11 KV and below
the above policy directives for SRPs,
would be average cost of including metering, billing, settlement,
service of the DISCOM as payment(s) and technical aspects etc.
determined by TSERC. would be made available on the TSSPDCL
/TSNPDCL website.

07
 SOLAR OFFGRID
SOLAR PUMP SETS
The State Government in collaboration with the Central
Govt/MNRE/MOP/Multilateral agencies will undertake
measures to enable gradual replacement of conventional
pumpsets to solar powered pumpsets through subsidy
support. The Nodal Agency will engage with various stake-
holders for materializing subsidies, grants and/ or incentives
on behalf of TSDISCOMS. The scheme of gross metering
facility would be extended to project developers/ farmers for
setting up solar powered pumpsets in the State. The
modalities for implementing the solar powered pumpset
program including commercial framework and technical
aspects shall be issued by DISCOM within 30 days from the
date of issue of this policy.

SOLAR OFF-GRID APPLICATIONS

The State Government and the DISCOMS, through various
awareness programs, shall actively encourage use of solar
powered applications for both domestic, industrial as well as commercial purposes. The
Nodal Agency shall work with DISCOMS to create an enabling framework with direct/indirect
benefits for replacement of conventional applications with solar powered applications.

Villages
Solar Power Plant

Factories
City & Buildings

Individual houses

EASE OF BUSINESS – ENABLING PROVISIONS

The State, in order to encourage solar based generation, has prepared the following
measures for improving the ease of doing business. However the project developer has to
ensure that the generation is within the time limit stipulated in the PPA or within a maximum
period of 2 years from the date of application whichever is earlier, failing which the provisions

08
under this policy automatically stands cancelled. The following provisions are for Solar Power
Projects (SPP) and Solar Parks, wherever applicable
a) Facilitation of expeditious approvals through single window clearance
The Solar Policy Cell (SPC) will undertake single window clearance for all SPPs. A
transaction charge of Rs.10,000/MW shall be applicable for processing
applications for single window clearance with a maximum of rupees two lakhs per
project. The modalities of the single window clearance mechanism shall be notified
within 30 days from the date of issue of this policy.
b) Deemed conversion to Non-agricultural land status
It is the responsibility of the project developer to acquire land for solar project. Land
acquired for grid-connected SPPs for sale to DISCOMs/ captive use/ third party
sale or for Solar Parks shall be deemed to be converted to Non-agricultural land
status on payment of applicable conversion charges to the SPC and no further
conversion procedures need to be followed by the developers in respect of such
land. The conversion charges would be as per the Agricultural Land (Conversion for
Non-agricultural Purposes) Act, 3 of 2006 amended from time to time.
c) Exemption from Land Ceiling Act
The ceiling limit as per the land ceiling act will not be applicable for any land
acquisition for Solar Power Projects and Solar Parks. However, this exemption is
available only against firm orders/ PPAs/ successful bids to the extent of land
required. Land requirement would be computed at rate of 5 acres/ MW or any lower
limit based on the advancement of technology.
d) Transmission and Distribution charges for
wheeling of power
The wheeling and transmission charges are
The Solar Policy Cell (SPC) will
exempted for captive use within the
undertake single window state. They will be charged as applicable for
clearance for all SPPs. A third party sale. The transmission and
transaction charge of Rs. distribution losses however is fully applicable
10,000/MW shall be applicable for both third party within the State as well as
for processing captive use within the State.
applications for single window e) Power Scheduling and Energy Banking
clearance with a maximum of
All SPPs shall be awarded must-run status
rupees two lakhs per that is injection from solar power
project. projects shall be considered as deemed to
be scheduled.
Banking of 100% of energy shall be permitted
for all Captive and Open Access/ Scheduled
consumers during all 12 months of the year. Banking charges shall be adjusted in kind @ 2%
of the energy delivered at the point of drawl.
The banking year shall be from April to March. Banked units cannot be consumed/ redeemed
in the peak months (Feb to June) and in the peak hours (6 pm to 10 pm). The provisions on
banking pertaining to drawal restrictions shall be reviewed based on the power supply
position of the State.

09
 For captive/ third party sale, energy injected into the grid from date of synchronization to open
access approval date will be considered as deemed energy banked.
The unutilized banked energy shall be considered as deemed purchase by DISCOM(s) at
average pooled power purchase cost as determined by TSERC for the year.
For Sale to DISCOMS, Energy injected into the grid from date of synchronization to
Commercial Operation Date (COD) will be purchased by the DISCOMS at the first year tariff
of the project, as per the provisions of the PPA with DISCOMS.
f) Electricity Duty
Electricity duty shall be exempted for captive consumption, sale to DISCOMS and
third party sale in respect of all SPPs set up within the state. Also, Electricity duty will
be waived for the new manufacturing facilities and ancillaries of the Solar Power
Projects.
g) Cross Subsidy Surcharge
For SPP located within the state and selling power
to third parties within the state, 100 % exemption
shall be provided on the cross subsidy surcharge In respect of SPPs selling
as determined by TSERC for five years from the power to the DISCOMS,
date of commissioning of the SPP. settlement of energy shall be
h) Bill Settlement as per the PPA executed
between the SPP and the
I n r e s p e c t o f S P Ps s e l l i n g p o w e r t o
DISCOM
the DISCOMS, settlement of energy shall be as
per the PPA executed between the SPP and the
DISCOM.
i) Grid Connectivity and Evacuation facility
SPPs shall be evacuated at the appropriate voltage level at the interconnection
point of TSTRANSCO or TSDISCOMS and evacuation up to the interconnection
point shall be the sole responsibility of the SPP developer. The SPP shall conform to
the order, rules, regulations and guidelines issued by the TSERC/SLDC/RLDC/
TSTRANSCO from time to time on all matters pertaining to operation and
maintenance of the plant. The SPP developer shall bear the entire cost
of transmission infrastructure till the interconnection point, however the following
support shall be available to the SPP:
1) Supervision charges levied by the TSTRANSCO/DISCOMS shall be exempted
2) TSTRANSCO/DISCOMS shall process and close the proposals for
technical feasibility within thirty (30) days of receipt of application from the SPP
developer

10
j) Payment of Development Charges and
and permission from Gram Panchayat
Development charges and layout fee of INR
25,000 per acre basis shall be levied 100% refund of
payable to the respective Panchayat. The VAT/SGST for all the
land in fraction would be rounded to the inputs required for Solar
next integer for calculating the development Power Projects will be
charges. On payment of such amount, provided by the
Gram Panchayat will accord necessary
Commercial Tax
approvals for setting up of the solar power
project/ solar parks including permission for Department for a period
bore-wells. No further permission is of 5 years.
required at the Panchayat. For this purpose,
a separate category will be created
under the Panchayat rules. Gram
Panchayat will give permission within 14
working days from the date of making payment of development charges failing
which permission will be deemed to have been accorded.
k) Refund of VAT
100% refund of VAT/SGST for all the inputs required for Solar Power Projects will be
provided by the Commercial Tax Department for a period of 5 years.
l) Refund of Stamp Duty
Industries Department will provide incentive in terms of 100% refund of Stamp Duty
for land purchased for setting up Solar Power Project and/or Solar Parks.
Registration charges are payable as per rules.
m) Open Access
Intra-state Open Access clearance for the tenure of the project will be granted as
per TSERC regulations amended from time to time. In absence of any response or
intimation from Solar Policy.
Cell (SPC) to the generator within twenty one (21) working days, then such
application shall be deemed to have been given open access.

11
 SOLAR POLICY CELL

n) PCB clearances
SPPs using PV or solar thermal technology, being a part of green energy will be
given required clearances under pollution control laws within a week by the
TSPCB.
o) Provisions under the Factories act
The grid-connected SPPs setup for sale to DISCOMs/ captive use/ third party sale
will be registered as factories (for the purpose of labour) under the factories act
and the entire process shall be completed within a week.

NODAL AGENCY
The Nodal agency shall be responsible for availing subsidy for solar roof-top systems, solar
pumpsets, as per MNRE guidelines and shall co-ordinate with MNRE/Solar Policy Cell (SPC)
of Discom.

SOLAR POLICY CELL

A dedicated Solar Policy Cell (SPC) shall be set up by TSDISCOMS under this policy for
single window clearance of the Solar Power Projects (SPP). The responsibilities include the
following:
a) All clearances and approvals pertaining to DISCOMS and TSTRANSCO
b) Obtaining power evacuation approval and/ or Open Access
c) Other clearances and approvals such as Panchayat/ Municipality clearances,
agricultural land conversion

PROJECT MONITORING COMMITTEE

A “High Level Committee” constituted with the following members will monitor the progress
of implementation of the Solar Power Projects cleared under the policy:
1. Secretary, Energy Department
2. Chairman and Managing Director, TSTRANSCO

12
 3. CMD of TSSPDCL
4. CMD of TSNPDCL
5. VC& MD,TNREDCL / Director(Commercial)TSSPDCL ( Member-Convener)
6. Representative of FAPTCCI/CII/FICCI (maximum of two members on rotating
basis)
7. Representatives of Solar Power Developers (2 members)

REVIEW
REVIEW
State Govt. reserves the right to review as and when need arises in view of any technological
breakthrough or to remove any inconsistency with Electricity Act 2003, as amended from
time to time, rules and regulations made thereunder or any related policy of Govt. of India.

SAVING CLAUSE
State Government has the discretion and reserves its right to make changes in the policy.
However, the incentives and exemptions provided under the policy for the projects
commissioned before effecting of the change, shall remain as it is, for the operative period of
the policy.

POWER TO REMOVE DIFFICULTIES

If any difficulty arises in giving effect to this policy, Energy Department is authorized to issue
clarification as well as interpretation to such provisions, as may appear to be necessary for
removing the difficulty either on its own motion or after hearing those parties who have
represented for change in any provision.

13
 SOLAR POWER INSTALLATIONS
IN THE STATE OF TELANGANA

1st Solar Roof Top Project Synchronized with the Grid at Jubilee Hills, Hyderabad

60 MW Solar Power Plant at Zaheerabad, Medak District

14
10 MW Solar Power Plant at Midjil Village, Mahbubnagar District

15
 NOTES

16
Arvind Kumar, I.A.S., Room No. 328-A, D-Block, 2nd floor,
Secretary to Government, Telangana State Secretariat, Hyderabad-500022,
Energy Department, Telangana, India.
Government of Telangana Tel: (Off.): 040-23453305, Tele fax: 040-23455452
E-mail : secy_energy@telangana.gov.in
Website: www.telangana.gov.in

D. Prabhakar Rao, Room No.659, 6th Floor,

Chairman & Managing Director, 'A' Block, Vidyut Soudha, Khairatabad,
Transmission Corporation of Hyderabad-500082, India.
Telangana Limited Tel: (Off.) 040-23317657, 040-66665135,
Fax: 040-23320565
E-Mail: cmd_transco@telangana.gov.in
Website: www.transco.telangana.gov.in

D. Prabhakar Rao, Room No.225, 1st Floor,

Chairman & Managing Director, 'A' Block, Vidyut Soudha, Khairatabad,
Telangana State Power Generation Hyderabad-500082, India.
Corporation Limited Tel (Off.): 040-23391174, 040-23499890,
Fax: 040-23499166
E-Mail: cmdtgenco@gmail.com
Website: www.tsgenco.telangana.gov.in

G. Raghuma Reddy Southern Power Distribution Company of

Chairman & Managing Director Telangana Limited,
6-1-50, 5th Floor, Corporate Office,
Mint Compound, Hyderabad-500063, India.
Tel: 040-23454884, 23431018,
Fax: 040-23452590
E-mail: cmd_tssouthernpower.com
Website: www.tssouthernpower.com

Telangana New & Renewable Energy 5-8-207/2, Pisgah Complex,

Development Corporation Limited Nampally, Hyderabad-500 001, India.
Tel: 040-23201502; 23201503
Fax: 040-23201504
E-mail: infotnredcl@gmail.com
Website: www.nedcap.gov.in
ENERGY DEPARTMENT
Government of Telangana
www.telangana.gov.in
www.tempestadvertising.com