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HERC Amends Net Worth Formula for QCA Selection to Prevent Double Deduction

The Haryana Electricity Regulatory Commission (HERC) has amended the formula for determining the net worth of Qualified Coordinating Agencies (QCAs), addressing an error that led to a double deduction of liabilities. QCAs serve as intermediaries between power generators and the state load dispatch centres for forecasting, scheduling, and deviation settlement of solar and wind energy.

The amendment was made following petitions by CleanMax and ASK Automotive, who highlighted that the earlier formula unjustly reduced net worth by deducting liabilities twice. This miscalculation caused CleanMax to be ineligible to act as a QCA for its 6.6 MW captive solar project developed in a 50 MW solar park, resulting in stranded power and losses.

The previous formula, which included liabilities as a separate deduction alongside items like intangible assets and carried-forward losses, has now been revised. The new formula reads:
Net worth = Share Capital + Reserve – Revaluation Reserve – Intangible Asset – Miscellaneous Expenditure not written off – Carried Forward Losses.

The Commission acknowledged the earlier ambiguity and its misalignment with standard accounting practices. It also noted that the stringent and flawed criteria restricted the pool of eligible QCAs. The amendment aims to improve fairness and ensure more participants qualify to manage scheduling and deviation responsibilities in Haryana’s renewable sector.