Clean Tech

Why gross metering is a problem for sellers

M Ramesh | Updated on January 24, 2021

Low key: India’s rooftop solar capacity is only 6,000 MW   -  ISTOCK.COM

Infrastructure costs will balloon panel outlay, particularly in multi-storey buildings that require longer cabling than individual units

India’s rooftop solar capacity is about 6,000 MW, considerably lower than the target of 40,000 MW that the government seeks to achieve by March 2022. To mainly give a fillip to rooftop installations, last month it notified the Electricity (Rights of Consumers) Rules, 2020.

The Rules recognise ‘prosumers’ — a class of consumers who also generate and sell electricity to the grid. One of the key measures in the Rules is that consumers may put up a solar plant on their premises, rooftop or otherwise, and directly sell the electricity generated to the utility (electricity distribution company or discom). Because few would want to put up a solar plant on their lawns or compounds, these rules largely aim at promoting rooftop solar capacity.

In a system called ‘gross metering’, what prosumers buy from the grid and what is put into the grid are two separate streams. The minimum capacity of the solar plant for gross metering should be 10 kW, and the upper limit for the capacity would be fixed by what the respective state electricity regulator would permit. The regulator would also fix the tariff for the sale of electricity from the prosumer.

Experts, however, point out that this ‘gross metering’, though well-intended, has one major problem. If you have a rooftop solar plant and wish to sell power to the discom, you have to build the infrastructure needed to evacuate the power. You need to put separate cables all the way from the solar inverter to the gross meter, which has to be installed separately.

“The cost of this additional infrastructure will in most cases be much higher than the cost of the solar PV systems themselves,” says Toine van Megen, Co-Founder, Auroville Consulting, which advises utilities on solar energy. This will be particularly problematic in multi-storey buildings, where the cabling would be longer than that in individual units.

So far, discoms have been doing ‘net metering’ — deducting power sold by a rooftop solar plant from the power drawn from the grid. This is really payment in kind — kWhr for kWhr. Discoms have never liked rooftop solar plants principally because of two reasons. One, the plants reduce the demand for power from (typically) well-paying consumers. Two, the (surplus) electricity supplied to the utility by the rooftop plants is valued at the same price as the consumer pays — even though solar plants produce power at a much cheaper rate.

As such, the discoms have always tried to spook consumer plans to go rooftop, which is the singular reason why rooftop solar hasn’t taken off, despite the government heavily subsidising the installations. (The Ministry of New and Renewable Energy pays 40 per cent of the cost of the plant that is up to 3 kW and 20 per cent for capacities between 3 kW and 10 kW.) But discoms have been imposing their own conditions or holding back approvals to protect their clientèle.

And now comes gross metering. Apparently, the authors of the Rules thought gross metering was simpler and perhaps better paying. But in practice it may not be so simple. After all, nobody puts up a rooftop solar plant aiming to sell power — the idea is for self-consumption; only the surplus is sold. Gross metering tends to look at it as a separate business.

Megensays the solution is ‘net feed-in metering’, where in a bidirectional meter electricity flows both ways. Unlike in net metering, there is no net-off, but payment is made separately for what the prosumer sells. This way, you avoid building the evacuation infrastructure.

Experts believe policies should favour prosumers rather than discoms.

Discoms, beware, for battery costs are falling rapidly. With technologies such as solid electrolytes and metal cathodes, energy densities are bound to go up, bringing down storage costs. Rooftop owners could just buy storage for parking any surplus energy and island themselves — goodbye to discoms. For the discoms, there could be no surer way to disaster.

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Published on January 24, 2021
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