Gujarat industries face solar setbacks due to new energy banking cap

Gujarat Urja Vikas Nigam Ltd (GUVNL), a state-owned power utility in India, has introduced new regulations affecting industries adopting solar power under the Gujarat Renewable Energy Policy 2023. The rules cap energy banking at 30% for captive solar projects, making full solar migration unviable for many businesses. Industries seeking to reduce registered but non-commissioned solar capacity must pay INR 10 lakh (~$11,000) per MW penalty. According to a GUVNL circular, grid connectivity applicants under the Captive mode between October 2023 and August 31, 2024, can surrender Technical Feasibility Report (TFR) connectivity capacity only by paying this penalty. The Gujarat Chamber of Commerce and Industry (GCCI) and solar power developers have opposed the policy, citing financial strain, particularly on MSMEs. GCCI has urged the state government to reconsider the regulations, calling for a higher banking cap and a one-time exemption for industries registered under the previous policy.