Group Captive

Group captive is an arrangement through which a developer sets up a power project for the collective use of multiple industrial or commercial consumers who have 26% equity in the project and must consume 51% of the power produced.The primary advantage of a group captive model is that cross-subsidy, and additional surcharges are not levied on the power procured. For industrial consumers, captive solar projects make sense as most projects or manufacturing units have poor quality or small roofs, which may only allow them to meet 10-15% of their energy consumption whereas renewable purchase obligations (RPO) for these companies are much higher and many have also signed up for RE100 initiative. Industrial tariffs tend to be higher than residential and it effects the profit maximization condition. This way, industries will get cheaper rate. Business Standard estimates the market rate to be around Rs 3/ unit while production cost to be around Rs 3.50/unit.The consumers in the group captive scheme no longer need to worry about bureaucratic utilities.

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