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OERC Proposes New 10 MW Distributed Renewable Energy Framework With Battery Storage and Six Metering Models

The Odisha Electricity Regulatory Commission (OERC) has proposed a new regulatory framework for grid-interactive distributed renewable energy systems, seeking to bring rooftop solar, battery storage and other decentralised renewable-energy installations under a more flexible and modernised set of rules. The draft Odisha Electricity Regulatory Commission (Grid Interactive Distributed Renewable Energy Sources) Regulations, 2026 proposes provisions for projects of up to 10 MW, multiple metering arrangements, battery energy storage and exemptions from several electricity-system charges.

OERC has invited stakeholders to submit comments and suggestions on the draft by August 31, 2026. The Commission will consider the responses before finalising the regulations and publishing them in the Official Gazette. The proposal is intended to update Odisha's regulatory framework in line with the changing nature of distributed generation and the growing need for storage and grid flexibility.

DRES Projects Up to 10 MW Proposed Under New Framework

The draft would cover distributed renewable energy systems with an installed capacity of up to 10 MW connected to transmission or distribution networks at voltage levels of 33 kV and below. Consumers would be able to develop such projects independently or through Renewable Energy Service Companies (RESCOs), while renewable-energy projects implemented under government programmes would follow the applicable Central or State Government guidelines.

The proposed framework represents a shift from a rooftop-solar-centric approach towards a broader distributed-energy model. It would establish rules not only for conventional rooftop generation but also for shared renewable-energy arrangements, behind-the-meter systems and storage-integrated projects.

The proposal also follows a broader regulatory movement in India. The Forum of Regulators has listed its Model Regulations for Grid Interactive Distributed Renewable Energy Sources 2025 among its model regulations, with the framework covering newer distributed-energy arrangements and storage-related provisions.

Battery Storage Becomes a Key Element of Larger DRES Projects

One of the most significant provisions in the Odisha draft is the proposed integration of Battery Energy Storage Systems (BESS) with larger distributed renewable-energy installations.

For DRES systems above 10 kW, the draft proposes hybrid or grid-forming inverters along with battery storage. The proposed minimum storage requirement would be linked to the size of the renewable-energy installation: 10% of installed capacity for projects up to 100 kW, 20% for projects above 100 kW and up to 500 kW, and 30% for projects above 500 kW and up to 10 MW.

OERC also proposes that batteries should preferably be charged during solar-generation hours and discharged during periods of peak electricity demand. In practical terms, this would allow part of the electricity generated during the daytime to be shifted to higher-demand periods, improving the usefulness of distributed solar beyond direct daytime consumption.

The emphasis on storage is consistent with discussions at the national regulatory level. During the Forum of Regulators' deliberations on its model DRES regulations, members considered minimum storage requirements for larger net-metered distributed renewable-energy systems, highlighting the growing role of BESS in managing variable renewable generation.

Six Metering Models Give Consumers Greater Flexibility

The proposed regulations would provide six different mechanisms for connecting and accounting for distributed renewable generation:

• Net Metering
• Net Billing
• Gross Metering
• Group Net Metering
• Virtual Net Metering
• Behind-the-Meter systems

Under the proposed framework, domestic consumers, government educational institutions, government hospitals, local-authority buildings and agricultural consumers would remain eligible for net metering, with proposed DRES capacities ranging from 1 kW to 500 kW.

Net billing and gross metering would be available to all consumer categories, subject to the applicable conditions. Group net metering and virtual net metering would provide options for consumers who need to share or allocate renewable-energy benefits across more than one electricity connection.

The inclusion of these mechanisms is particularly significant because it moves the regulatory framework beyond the traditional one-premises-one-meter rooftop solar model. It could enable wider participation by consumers that have limited rooftop space or multiple electricity connections.

Surplus Generation Would Be Settled Through a Defined Payment Mechanism

The draft also proposes detailed rules for energy accounting, billing and settlement of surplus renewable electricity under the different metering mechanisms.

At the end of the applicable settlement period, surplus energy would be compensated at a feed-in tariff determined by OERC, with the proposed payment mechanism providing for direct digital transfer to the consumer's bank account.

The final economic value of surplus generation will depend on the tariff and settlement provisions ultimately approved by the Commission. Consequently, the commercial attractiveness of different DRES models for households, commercial consumers and industrial users could change once the final regulations and associated tariff orders are issued.

Charge Exemptions Proposed to Improve Project Economics

OERC has proposed exemptions from several network-related charges for eligible projects operating under net metering, net billing, gross metering and behind-the-meter arrangements.

The proposed exemptions include transmission charges, wheeling charges, cross-subsidy surcharge and additional surcharge, subject to the conditions specified in the regulations.

The treatment of group and virtual net metering could be different where the generating installation and participating consumer connections are associated with different feeders or substations. OERC has also retained the ability to introduce Grid Support Charges or Parallel Operation Charges through separate orders.

These provisions could have an important bearing on the economics of distributed renewable-energy projects, particularly for commercial and industrial consumers considering larger systems.

Hosting Capacity and Technical Standards to Become More Important

As distributed solar penetration increases, the ability of local distribution networks to accommodate two-way electricity flows becomes increasingly important. OERC's draft therefore includes provisions covering hosting capacity, technical connectivity, metering infrastructure, safety requirements and energy accounting.

Distribution licensees would be required to establish dedicated online portals, publish standardised application procedures and upgrade billing systems within prescribed timelines.

Such provisions are intended to make the connection process more predictable while giving DISCOMs a structured mechanism for assessing the technical impact of additional distributed generation on feeders, substations and other network assets.

The Forum of Regulators' model DRES framework similarly reflects the increasing importance of technical integration and storage as distributed renewable generation expands across India's electricity distribution networks.

Odisha's Earlier 2026 Draft Took a Broader RCO Approach

The latest DRES proposal follows an earlier OERC initiative launched in April 2026. On April 10, 2026, the Commission issued a draft covering Renewable Consumption Obligation, Distributed Renewable Energy Sources and Renewable Energy Linked Concepts and invited stakeholder objections and suggestions by May 8.

That earlier proposal contained a broader renewable-energy compliance framework alongside DRES provisions. OERC's subsequent decision to develop a separate DRES-focused framework reflects stakeholder feedback that renewable consumption obligations and distributed renewable generation should receive distinct regulatory treatment.

The separation could make the final DRES regulations more focused on consumer-level renewable generation, grid interaction, metering, storage and distribution-system integration.

Distributed Renewable Energy Is Becoming a Larger Part of Odisha's Clean-Energy Planning

The proposed DRES framework comes as renewable energy assumes a greater role in Odisha's electricity procurement and planning. OERC's FY 2026-27 power-procurement material indicates approved renewable-energy drawal of about 5,208.67 million units, including around 3,671 million units from solar and 1,537.67 million units from non-solar renewable sources and hydro-related procurement.

At the national level, the regulatory focus is also shifting towards integrating renewable generation with storage, flexible demand and smarter distribution networks. The Forum of Regulators' work on DRES has specifically examined storage requirements for larger systems, while newer regulatory discussions increasingly recognise the need for distributed resources to contribute to overall grid flexibility.

New Framework Could Reshape Odisha's Rooftop Solar and Distributed Energy Market

If adopted substantially in its proposed form, the OERC framework could create new opportunities for rooftop solar developers, RESCOs, battery-storage providers, consumers and distribution utilities.

For consumers, the six metering options could provide greater flexibility in choosing how renewable generation is used and accounted for. For developers, the expansion to projects up to 10 MW could open a larger distributed-energy segment beyond conventional residential rooftop installations.

The proposed BESS requirement, meanwhile, could accelerate the adoption of solar-plus-storage systems but may also increase initial project costs. The ultimate impact on consumers will depend on battery prices, tariffs, surplus-energy compensation, applicable network charges and the final technical requirements.

The regulations remain in draft form, and the provisions may change following stakeholder consultation. The next major milestone will be the Commission's consideration of comments received by August 31, 2026, followed by finalisation and notification of the regulations in the Official Gazette.