Karnataka Proposes Peer-To-Peer Energy Trading, Issues Draft Norms

Karnataka Proposes P2P Energy Trading Using Block Chain

A latest draft notification released by the Karnataka Energy Regulatory Commission (KERC) proposed Peer-to-Peer (P2P) system for energy transaction, through block chain-based platform between consumers and the discoms.

The notification stated, “The regulation is applicable to all the distribution licensees and eligible consumers of the state of Karnataka.” It defined blockchain as, “A digitally distributed decentralized public immutable ledger that exist across a network for recording transaction.” As per the set procedure under the notification, “Any P2P participant who wants to participate is required to register itself with their distribution licensee, who will then communicate the same to the service provider”.

The draft regulation said, “The concept has seen innovative usage in the energy sector for decentralized, renewable energy integration, efficiency and flexibility, empowering prosumers/ consumer, cost saving, grid resilience, etc.” It added, “The purpose of framing the regulation is to promote rooftop solar efficiency, utilization of existing asset and to implement innovative solution. The regulation is applicable on all the distribution licensee and eligible consumers in the state of Karnataka.”

The notification added, “15 days from the submission of registration, officer from the distribution licensee and the service provider are required to check the compatibility of the P2P participants for the readiness for P2P exchange. In case of acceptance of the distribution licensee and the service provider, the P2P participant registration to the platform is expected to be completed in 15 days.”

P2P Transactions 

The Policy suggested the use of a blockchain-based electronic platform by the service provider to sell their energy to P2P consumers at a mutually agreed-upon price by the service provider. The service provider is a ‘Discom Licensee’ that provides P2P energy transaction services on the Blockchain-based platform.

The notification stated, based on commission specification, the transaction fees is to be charged by the service provider for the P2P solar energy transaction on the P2P platform.

The case for under or Over Drawl Of Energy By P2P Consumers

1. Under Injection by P2P Prosumer/Consumer – Prosumer must make payment equivalent to the difference between the energy charge as per the rate schedule and the mutually agreed price on the P2P platform.
2. Over Injection of Energy by The Prosumer/Consumer – Energy settlement is the done based on gross or net.
3. Energy Adjustment in The Absence of Schedule – If no schedule is submitted by the Prosumer, the energy given by the consumer shall be adjusted based on gross and net meter arrangement.
4. Under drawl Of Energy by The P2P Consumers – The consumer makes full payment for the quantum of energy pledged on the P2P platform.
5. Over drawl of Energy by P2P Consumer – The draft doesn’t mention any penal charges for overdrawl. But settlement first is to be done first towards making energy transacted on the P2P platform, and then to the energy supplied by the distribution licensee. In case the demand P2P transaction + purchase from distributed licensee exceed the contracted demand, penalty shall be imposed, under the provision set by the tariff.
6. In case of default payment for energy supplied by the distribution licensee appropriate action shall be taken.