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Madhya Pradesh Policy for Decentralized Renewable Energy Systems - 2016

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Nodal Agency

Madhya Pradesh UrjaVikas Nigam Ltd (MP Urja)

Applicable Technologies

Solar PV, rooftop solar PV, off-grid solar, hybrid RE.

Monitoring and Evaluation

All RE systems, subsidized either by GoI and/orthe state govt., will be subject to monitoring and evaluation by the nodal agency.

Exemptions for net metering

Net metered RE systems are exempted from wheeling and banking charges.

Incentive Amount

Not available

Eligibility Conditions

  • All RE beneficiaries, on whose premises off–grid or grid-connected RE systems are installed, including those who have installed RE systems before notification of this policy,and bulk consumerswho are single point connection consumers, persons or entities.
  • Policy is applicable for RE systems up to 2 MW

Registration Fees

Not available

Tax Exemptions

Not available

Evacuation Arrangement

Not available




This policy focuses, mainly, on rooftop solar PV systems, with net metering arrangements.


Decentralized RE project categories

  • Grid Connected RE Systems –
    • Category 1 – On net metering basis.
    • Category 2 – Gross metering with wheeling and banking.
    • Category 3 – For captive consumption only.
  • Off-grid RE systems 

Energy accounting and commercial arrangements

Arrangements for Category 1 –
  • Banked energy, i.e. excess or surplus, unutilized at the end of the settlement period shall be compensated by the distribution licensee as per the MPERC Regulations 2015. Such units shall be purchased at Average Power Purchase Cost for that year.
  • The RE beneficiary shall procure the requisite LT/HT bidirectional meter/net meter as specified by the distribution licensees, at his cost.

Arrangements for Category 2 –

  • Wheeling and banking is allowed upon payment of charges, wherever applicable.
  • RE beneficiaries falling under consumer categories for which the charges on drawing reactive energy from grid are defined by MPERC, shall be required to pay such charges as per prevailing tariff and relevant provisions. 

Implementation through RESCO

Installation of RE systems can be undertaken by a Renewable Energy Services Company (RESCO). The RESCO can operate on BOOM or BOOT basis, on mutually agreed terms, with the RE beneficiary.

  • For consumers, as specified under Category-I and III, RESCO would enter into a PPA to sell metered units of electricity at a mutually agreed price.
  • For consumers under Category-II and off-grid model, the power would be generated by the RESCO and the consumer can dispose the power in accordance with the extant policies.


The quantum of energy produced from the RE system of a net metered consumer who is not defined as an Obligated Entity, shall qualify towards compliance of Renewable Purchase Obligation (RPO) for the distribution licensee in whose area of supply the net metered consumer is located. 

Incentives by State Govt.

  • Facility of Open Access will be available to all RE Systems in accordance with MPERC open access regulations
  • The state government will provide a grant of 4% for wheeling charges, applicable as specified by MPERC, in terms of energy injected.
  • Banking shall be allowed in accordance with MPERC (Cogeneration   &   Generation   of   Electricity   from   Renewable   Sources   of Energy) Regulations, 2010
  • RE Systems under this Policy shall be exempted from cross-subsidy  charges

Provision for Policy Review

Not available





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