GERC's Draft Banking Charge
Regulations for Green Energy Open Access
Two new draft amendments — the 5th and 6th — propose to extend the current ₹1.50/unit charge, then replace it with a scientifically determined rate from September 2026 onwards. Here's what it means for C&I consumers in Gujarat.
At a Glance
What GERC is Proposing
Section 01
What Is Banking and Why Does the Charge Matter?
Banking is one of the most commercially important features of Green Energy Open Access for C&I consumers in Gujarat.
Banking in plain language: When your solar or wind plant generates more power than you consume in a 15-minute slot, the surplus units are "banked" — virtually stored with the DISCOM. You can draw them back later when your consumption exceeds generation. This allows you to run a solar-heavy plant without worrying about slot-by-slot matching of generation and consumption.
The banking charge is what you pay the DISCOM for providing this service — it compensates the utility for the cost of managing the surplus energy on your behalf (holding it, potentially selling it on exchanges, and returning it when you need it).
For a typical C&I GEOA project in Gujarat consuming 1 MU/month, the difference between ₹1.50/unit and ₹1.00/unit banking charge translates to approximately ₹4–6 lakhs per year in savings — depending on your banking utilisation rate. Accurate forecasting of this charge is critical to your open access savings calculation.
Key Banking Rules Under GERC GEOA Regulations 2024
| Parameter | Rule |
|---|---|
| Banking period | One calendar month (billing cycle) — no carry-forward to next month |
| Banking limit | Maximum 30% of total monthly consumption from DISCOM in a billing cycle |
| Off-peak to peak use | Energy banked in off-peak slots cannot be drawn in peak slots |
| Peak to off-peak use | Energy banked in peak slots can be drawn in both peak and off-peak slots |
| Lapse rule | Any banked energy unused at month-end is deemed lapsed — no compensation |
| No-banking option | Consumers can opt out of banking; surplus then treated as inadvertent flow |
Section 02
The ₹1.50 Journey — Six Extensions and Counting
GERC originally set the banking charge at ₹1.50/unit as an interim measure when GEOA regulations were first notified in February 2024. The rate has since been extended five times — and a sixth is now proposed.
Developing a scientifically sound banking charge methodology requires 15-minute slot-level data from all DISCOMs — DGVCL, MGVCL, PGVCL, UGVCL, Torrent Power, and smaller licensees. Collecting, validating, and analysing this data across a large and growing consumer base (165+ GEOA consumers tracked in the latest study) has taken longer than initially anticipated.
Section 03 · Draft 5th Amendment
Draft 5th Amendment — Bridging the Gap to 31 August 2026
Stakeholder comments invited until 20 June 2026. Public hearing: 22 June 2026. Will come into force only upon publication in the Official Gujarat Gazette.
The Draft 5th Amendment is a straightforward bridging measure. With the 4th Amendment's ₹1.50/unit validity expiring on 30 June 2026, and the comprehensive 6th Amendment methodology still undergoing stakeholder consultation, GERC proposes a two-month extension to avoid a regulatory gap.
| Aspect | Detail |
|---|---|
| Regulation amended | Regulation 1(4) and Regulation 17.6(viii) of GEOA Regulations 2024 |
| What changes | Banking charge of ₹1.50/unit extended until 31 August 2026 (or earlier if GERC notifies separately) |
| What does NOT change | All other banking rules — limits, ToD slot restrictions, lapse rules — remain unchanged |
| Trigger to end early | Commission retains right to notify a different charge before 31 August 2026 via separate notification |
| Stakeholder comments due | 20 June 2026 |
| Public hearing | 22 June 2026 (hybrid mode) |
No action needed. Your existing GEOA project economics for July–August 2026 remain unchanged at ₹1.50/unit banking charge. Focus your attention on the 6th Amendment, which makes the substantive change from September 2026 onwards.
Section 04 · Draft 6th Amendment
Draft 6th Amendment — The Big Change: New Rate + New Methodology
Stakeholder comments invited until 20 July 2026. Public hearing: 21 July 2026, hybrid mode, GERC office at GIFT City, Gandhinagar. Will come into force only upon publication in the Official Gujarat Gazette.
Part A — The New Rates
| Period | Proposed Rate | Basis |
|---|---|---|
| 1 Sep 2026 – 31 Mar 2027 | ₹1.00/unit | Based on GERC study of 165 GEOA consumers (Apr 2025–Jan 2026). Estimated actual cost: ₹1.06/unit. Rounded down to ₹1.00 acknowledging data limitations and small sample size. |
| 1 Apr 2027 onwards | Data-based (annual) | Determined each FY based on preceding calendar year data from DISCOMs. Floor: ₹0.50/unit. Ceiling: ₹1.50/unit. |
Part B — Floor and Ceiling Mechanism (from FY 2027-28)
To provide regulatory certainty, GERC proposes bounding the annual determination within a range:
Banking charge cannot fall below ₹0.50/unit regardless of actual cost computation — protects DISCOM revenue adequacy.
Banking charge cannot exceed ₹1.50/unit — protects GEOA consumers from runaway charge increases.
The floor-ceiling mechanism applies only if the DISCOM provides complete, accurate data via sworn affidavit in the specified format and timeline. If a DISCOM fails to provide adequate data, its banking charge is deemed Nil for that period — ensuring the consequence of non-compliance falls on the utility, not the consumer.
Part C — DISCOM-wise vs. Common Charge
The 6th Amendment gives GERC flexibility to determine either individual DISCOM rates or common rates for groups:
| Category | Approach |
|---|---|
| State DISCOMs (DGVCL, PGVCL, MGVCL, UGVCL) | Commission may determine a common banking charge applicable to all four |
| Private licensees with common procurement | Commission may apply a common charge |
| SEZ/SIR/Port DISCOMs and new licensees | Commission may apply the same charge as state DISCOMs |
| Torrent Power (private, independent) | Individual determination based on Torrent's own data submission |
Section 05
How Will the Banking Charge Be Calculated from FY 2027-28?
The 6th Amendment includes a detailed Annexure-I with the step-by-step methodology. Here's the plain-language version — the key insight is that the charge reflects the actual net cost to the DISCOM of providing banking.
Banking Charge (₹/unit) = Aggregate Net Banking Cost ÷ Total Banked Energy
The "net banking cost" is the DISCOM's cost of managing your banked energy (backing down thermal plants, buying/selling on IEX, using BESS) minus the revenue it earns from those activities. Divided by total energy banked — giving a per-unit charge.
Slot-wise Surplus/Drawl Computation
For each 15-minute slot, compute net surplus (generation > consumption) or net drawl (consumption > generation) for every GEOA consumer. Track cumulative banking separately for peak and off-peak periods on a FIFO basis.
Consolidation at DISCOM Level
Sum up all consumers' slot-wise surplus, drawl, banked energy, and lapsed energy across the billing cycle (calendar month) to get DISCOM-level totals for each 15-minute block.
Cost & Revenue Calculation per Slot
For each slot, compare IEX market clearing price against variable cost of marginal thermal stations. Based on which is cheaper, compute: cost to DISCOM (of buying from IEX or running thermal) and revenue earned (from selling surplus or saving generation). Four scenarios covered.
Aggregate Banking Charge for the Year
Sum all net banking costs across all 15-minute slots for the calendar year. Divide by total banked energy (excluding lapsed energy). The result is the banking charge in ₹/kWh for the next financial year.
Key Inputs Used in the Methodology
| Input | Source | Why It Matters |
|---|---|---|
| IEX Market Clearing Price | Real-time (10.5%) + Day-ahead (89.5%) combination | Determines whether DISCOM sells surplus on exchange or uses internally |
| Variable cost of marginal thermal station | GERC Tariff Order | Benchmark for DISCOM's internal generation cost |
| Backing down cost | 8% of total thermal cost (CEA Flexibilisation Report) | Cost of reducing thermal output when surplus RE is available |
| BESS LCOE | Average of BESS bids (without VGF) from preceding year | Cost of energy storage used by DISCOM to manage RE surplus |
| Transmission charges & losses | GERC Tariff Order, ISTS loss data from Grid Controller | Adjusts the effective cost of IEX transactions |
| Distribution losses | Latest GERC True-up Order per DISCOM | Net injection = gross injection × (1 – loss%) |
Section 06
What This Means for C&I Consumers in Gujarat
Impact on Project Economics
| Period | Banking Charge | Change vs. Today | Indicative Annual Impact* |
|---|---|---|---|
| Until 30 Jun 2026 | ₹1.50/unit (current) | — | Baseline |
| Jul–Aug 2026 (5th Amendment) | ₹1.50/unit | No change | No change |
| Sep 2026–Mar 2027 (6th Amendment) | ₹1.00/unit (proposed) | ▼ ₹0.50/unit saving | ~₹5 lakhs/MW/year saving* |
| From Apr 2027 onwards | ₹0.50–₹1.50/unit (data-based) | Variable | Depends on DISCOM data |
*Indicative only, based on ~10 MU/MW/year banking utilisation at ₹0.50/unit saving. Actual impact varies with your consumption profile, banking utilisation rate, and DISCOM.
Strategic Considerations
If the 6th Amendment is notified as drafted, the ₹0.50/unit reduction in banking charge from September 2026 improves the savings per unit of RE consumed under GEOA. Projects currently being evaluated should model both scenarios — ₹1.50/unit (conservative) and ₹1.00/unit (optimistic) — until the amendment is officially notified.
The ₹0.50–₹1.50/unit band means your maximum banking charge exposure is now capped. This makes long-term GEOA projects more bankable from a lender's perspective — the regulatory uncertainty around this charge is significantly reduced.
These are draft regulations undergoing stakeholder consultation. The final notified charge may differ from the draft. Continue using ₹1.50/unit for project appraisals until official gazette notification.
ToD Banking Rules — Unchanged but Important to Re-review
The new amendments do not change the existing ToD banking slot restrictions. These remain a key commercial consideration:
| Solar generation period | Can bank in | Can draw back in |
|---|---|---|
| Off-peak slots (daytime solar hours) | Off-peak banking pool | Off-peak slots only — cannot use in peak slots |
| Peak slots (if any generation) | Peak banking pool | Both peak and off-peak slots |
| End of month surplus | Lapses — no compensation, no carry-forward | |
Section 07
Frequently Asked Questions
Public Hearing · 6th Amendment
Your Voice Matters — Submit Comments Before 20 July 2026
GERC has invited comments, suggestions, and objections from all stakeholders on the Draft 6th Amendment. This is your opportunity to shape how banking charges are determined for the next several years.