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Madhya Pradesh Electricity Regulatory Commission (Demand Side Management) Regulations, 2016
Published vide Notification No. 1616 /MPERC /2016, dated 05.10.2016
Last Updated 11th February, 2020 [mp913]
(a) "Act" means the Electricity Act, 2003 (No. 36 of 2003);
(b) "Baseline data" means the initial base level consumption and/or demand for electricity before a DSM programme begins to provide a starting point for comparison for assessing programme impact";
(c) "Bureau" means the Bureau of Energy Efficiency established under sub-section (1) of section 2 of The Energy Conservation Act, 2001;
(d) "Commission" means the Madhya Pradesh Electricity Regulatory Commission;
(e) "Cost Effectiveness Index" means an indicator of the attractiveness of any investment in DSM programme or when compared to the costs of energy produced and delivered in the absence of such an investment;
(f) "Demand Side Management (DSM)" means the actions of a Distribution Licensee, beyond the customer's meter, with the objective of altering the end-use of electricity - whether it is to increase demand, decrease it, shift it between high and low peak periods, or manage it when there are intermittent load demands - in the overall interests of reducing Distribution Licensee costs;
(g) "DSM Resource Acquisition" means a mechanism to implement DSM projects through customers, Energy Service Companies, Non- Government Organizations, manufacturers/ suppliers, or other private sector organizations, with payment made to them by the Distribution Licensee for the resultant energy and load reductions;
(h) "Energy Service Company" means a company which is in the business of providing energy efficient and load management equipment and/or services to end-use customers and is approved by Bureau;
(i) "Evaluation, Measurement and Verification" means activities which evaluate, measure and verify performance or other aspects of DSM /energy efficiency programs or their market environment;
(j) "Monitoring and Reporting" means activities which monitor and evaluate the progress of DSM /energy efficiency programs of the Distribution Licensee.
3. Objectives, targets and guidelines of Demand Side Management (DSM). - (1) The Commission in consultation with the Distribution Licensees of State and the State nodal agency designated by the Bureau shall formulate DSM objectives that shall be considered in the advancement and implementation of cost effective DSM initiatives in the State. (2) The objectives may include power shortage mitigation, seasonal peak reduction, cost effective energy savings, lowering the cost of electricity, reduction in emissions of greenhouse gases etc. (3) While formulating the DSM Objectives, National DSM Objectives/ Plans formulated by the Bureau if any, may be taken into consideration. (4) The DSM objectives may be consistent with the DSM objectives set out by Bureau as a part of Energy Conservation Plan for the country. 4. Assessment of technical potential for DSM. - (1) The Distribution Licensees and the State nodal agency designated by the Bureau shall carry out assessment of potential for DSM in the State within 6 months from the date of notification of Regulations. (2) Distribution Licensee shall be guided by methodology developed by the Bureau while assessing of technical potential for DSM. 5. DSM Targets. - (1) The Commission in consultation with the Distribution Licensees and the State nodal agency designated by the Bureau shall establish DSM targets for each Distribution Licensee in the State. (2) While setting DSM target for the Distribution Licensee, due consideration to factors such as consumer mix, load profile, etc. shall be given. (3) Examples of DSM targets may include the following:(i) Percentage reductions in load growth;
(ii) Savings in kW, kWh;
(iii) Savings as a percent of total resources to meet load;
(4) While establishing the targets, the technical potential in the State as assessed by the Distribution Licensee shall be considered. 6. Guidelines on DSM process. - (1) The Commission in consultation with the Distribution Licensees and the -State nodal agency designated by -the Bureau shall issue guidelines for execution of the following activities :(a) Load and market research
(b) Implementation of DSM programmes
(c) Cost Effectiveness Assessment of DSM programmes
(d) Monitoring and Reporting of DSM Plans and programmes
(e) Eligibility criteria for DSM programmes
(f) Methodology for setting DSM targets and funding levels
(g) Database development framework
(2) The Commission shall issue guidelines on these matters from time to time (3) Issuance of such guidelines shall not be a pre-requisite for preparation and submission of the DSM plan by the Distribution Licensee. 7. Constitution of DSM Cell, its roles and responsibilities. - (1) The DSM Cell so constituted by the Distribution Licensee shall be provided with necessary authority and resources so as to execute the functions assigned to it under these Regulations (2) The DSM Cell shall be responsible for:(a) load research and development of baseline data;
(b) formulation of DSM Plan;
(c) design and development of DSM projects including cost benefit analysis, plans for implementation, monitoring and reporting and for measurement & verification;
(d) seeking necessary approvals to DSM Plan and individual programmes;
(e) implementation of DSM programmes;
(f) Any other additional function that may be assigned by the Commission from time to time.
8. Load and market research and development of baseline data. - (1) Distribution Licensee shall undertake load research to identify the target consumer segment/s and end uses for DSM programmes to build the necessary database. (2) Distribution Licensee shall undertake market research to estimate market potential for specific energy efficiency technologies and applications, establish key performance indicators, and determine existing baseline market conditions. (3) On the basis of the results of load and market research, the Distribution Licensee shall develop baseline data for its area of supply. (4) Distribution Licensee shall design, develop and implement the initial few DSM programmes on the basis of available data and studies completed by the Bureau till the complete baseline data is available for its area of supply and establishment of base line data shall not be a pre-requisite for design of such initial DSM programmes by the Distribution Licensee. 9. Formulation of DSM Plan. - (1) Distribution Licensee shall formulate and submit to the Commission a perspective DSM plan covering period of the control period, within one year of notification of these regulations. The Plan shall include:(a) an overall goal for DSM Plan;
(b) description of DSM programmes to form a part of DSM Plan;
(c) implementation process and schedule of each programme in the plan as a whole;
(d) plan for Monitoring and Reporting;
(e) indicative cost effectiveness assessment of programmes.
Provided that the first DSM plan shall be prepared within one year of the date of notification of these Regulations and shall be applicable for the period till the end of ongoing MYT Control Period. (2) The Distribution Licensee shall include all relevant DSM programmes (including multi-state programmes) developed by Bureau in its perspective plan as and when such programmes are announced by Bureau. (3) The Distribution Licensee shall submit on rolling basis, an annual plan, not inconsistent with the perspective plan, for upcoming year, along with the Annual Performance Review. (4) Selection and prioritization of various DSM programmes in the DSM plan shall be guided by the following factors:(i) The cost effectiveness guidelines issued by the Commission.
(ii) DSM objectives identified in Regulation.
(iii) Whether the proposed programmes supplement National level efforts adopted by the Bureau.
(iv) Programmes with high visibility and therefore potential for creation of awareness within consumers.
10. Commission review and approval of DSM plan. - (1) Distribution Licensee shall submit the DSM plan to the Commission for approval. (2) The Commission may adopt procedures as specified in the Conduct of Business Regulations for approval to the DSM plan. 11. Preparation of DSM Programme Document. - (1) For each DSM programme included in the DSM Plan, a detailed description shall be provided in a separate Programme Document. The description shall include general information, technology, schedule for deployment, budget, cost effectiveness assessment, detailed implementation plan, estimation of savings, etc. (2) For each DSM programme, cost benefit analysis shall be carried out as per guidelines issued by the Commission in consultation with the Distribution Licensee on cost effectiveness from time to time. 12. Approval of DSM Programme Document. - (1) Prior to implementing any DSM programme, Distribution Licensee must obtain approval of the Commission. (2) Each Programme Document shall include the following:(a) Description of the programme;
(b) Objectives and rationale for the programme;
(c) Consumer segments and estimated level of participation;
(d) Estimate of baseline;
(e) Assessment of programme in line with Cost Effectiveness Guidelines issued by the Commission;
(f) Mechanism for recovery of cost and performance incentives;
(g) Marketing, delivery strategy and Implementation schedule;
(h) Implementation mechanism e.g. Energy Service Companies, DSM Bidding, DSM Resource Acquisition, etc;
(i) Monitoring and evaluation plan;
(j) Plan for Training/Seminars/Workshops to increase consumer awareness.
(3) The Commission shall approve a DSM program if it is in line with the objectives set out in accordance with the provisions of Regulations. The Commission may direct modifications to proposed or on-going programmes to ensure consistency with the DSM objectives. However, the Commission shall allow Distribution Licensee adequate time to notify consumers of program modification. 13. Implementation of DSM programmes. - (1) Distribution Licensee shall undertake implementation of DSM programmes in line with the guidelines issued by the Commission from time to time. (2) The implementation of the programme shall be undertaken in the manner as approved by the Commission. (3) Distribution Licensee shall undertake implementation of quick gain DSM programmes. (4) Distribution Licensee shall carry out implementation of activities assigned to it either by itself or through engagement of appropriate independent entity. (5) The Distribution Licensee shall ensure that during implementation the continuity and consistency is maintained and interest of the consumers is not compromised. 14. Mechanism for Cost Recovery. - (1) Distribution Licensee shall identify the net incremental costs, if any, associated with planning, design and implementation of programmes. (2) Distribution Licensee may propose methodology for recovery of net incremental costs through tariff or any other mechanism. (3) In order to qualify for cost recovery, each program must be:(a) approved prior to implementation;
(b) implemented in accordance with the approved program plan; and
(c) implemented cost effectively.
(4) Distribution Licensee shall provide all necessary assistance to the Commission, or third party assigned by the Commission in undertaking Evaluation Measurement and Verification of DSM programmes implemented by it. (5) The Commission may direct the Distribution Licensee to undertake DSM programmes that may not be cost effective but is highly beneficial to the society. The Commission shall make available resources for such project. 15. Monitoring and reporting of DSM Programmes. - Distribution Licensee shall prepare a plan to undertake and monitor the report of DSM programmes as per Guidelines issued by Commission from time to time. 16. Evaluation, Measurement and Verification of DSM Programme. - (1) Distribution Licensee shall prepare plan for evaluation, measurement and verification of savings from DSM programmes as per Guidelines on Evaluation, Measurement and Verification issued by the Commission from time to time. (2) Third party Evaluation, Measurement and Verification of DSM programmes may be undertaken by the Commission or third party assigned by Commission: Provided that while engaging the agency, the Commission shall ensure that the Agency is not undertaking any other engagement which could conflict with the interests of the consumers in the State. (3) Distribution Licensee shall make available necessary information/data to the Commission or third party assigned by the Commission to measure and verify the savings from DSM programmes. 17. DSM Plan and Programme Completion Report. - (1) Reports on progress of DSM Plan and expenses incurred on implementation of DSM Plan shall be submitted by the Distribution Licensee every six months. (2) The Distribution Licensee shall prepare a detailed Program Completion Report and submit the same to the Commission within one month of completion of such programme. (3) The Report shall cover the programme expenses, achievements, outcomes and outputs, constraints and difficulties faced, conclusions, recommendations, lessons learned and way forward. 18. Savings. - (1) The Commission may, at any time add, vary, alter, modify or amend any provisions of these regulations. (2) If any difficulty arises in giving effect to the provisions of these Regulations, the Commission may, by general or specific order, make such provisions not inconsistent with the provisions of the Act, as may appear to be necessary for removing the difficulty (3) The Commission may, from time to time, issue orders and practice directions in regard to the implementation of the regulations and procedures to be followed. (4) All disputes arising under these regulations shall be decided by the Commission based on an application made by the person aggrieved.
