Bangalore: The electricity supply companies (ESCOMs) in the State must buy a minimum of 5 per cent and a maximum of 10 per cent of the energy purchased from renewable sources as per the KERC (Power Procurement from Renewable Sources) Regulations 2004.

The commission has to review the quantum of purchase from the renewable sources once in three years.

The regulations came into force on October 21, 2004 and the power procurement has to be reviewed by September 2007.

The State Government in an order (of March 2, 2007) approved the enhancement of the upper limit of the share of renewable energy to 20 per cent while the Indian Wind Power Association and the Karnataka Renewable Energy Development had urged the commission to increase it to 25 per cent.

Only the KERC had the power to specify the percentage of power that had to be purchased from the renewable sources by each ESCOM and so it had decided to review the Government Order and had invited views and suggestions from all stakeholders.

According to the discussion paper prepared by the commission, the percentage of power purchased from renewable sources had been increasing steadily.

The total power purchased from renewable sources in 2001 financial year was 1.34 per cent, which had now increased to 7.4 per cent in the 2007 financial year.

This is less than the 10 per cent maximum limit fixed by the commission.

The commission studied the power purchase cost by increasing the percentage of power purchased to 15, 20, and 25 per cent, when the input was 34,538 million units.

It considered the average cost of power from renewable sources at Rs. 3.32 a unit and from other sources at Rs. 1.58 a unit. By increasing the percentage to 15, 20 and 25 per cent from the current level, the power purchase cost would increase by 11, 20 and 29 paise respectively. This increase would then have to be passed on to the consumers through retail tariff.

The commission had asked the stakeholders, consumers and experts if the upper limit had to be removed and if retained, what should be the upper limit.

Also, if only the minimum percentage was specified, should ESCOMS be allowed to purchase power from renewable sources above the minimum percentage through competitive bidding with a ceiling price specified by commission.

The discussion paper is available on the commission's website (www.kerc.og) .

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