If your factory runs two or three shifts in Tamil Nadu and someone is offering you cheap solar power through open access, there is one rule change you need to understand first. Under TNERC's 2025 rules, the solar units you can't use during the day are no longer saved for you at night.
In short
- The rule: TNERC's Green Energy Open Access Regulations 2025, notified 18 September 2025, allow no banking for third-party open access.
- Where banking is still allowed (captive and group captive), it now costs 8% of the banked units, is settled every month instead of every year, and units banked in normal or night hours can only be drawn back in the same slot.
- The effect: third-party solar now only helps the part of your load that runs in daylight. For a round-the-clock factory, that is at most about 40% of its units.
- What still works: rooftop solar first, group captive for the rest, and wind or a wind-solar mix for evening and night load.
What banking was, in plain words
Say a solar plant makes 1,000 units for your factory on a sunny day, and your machines use 700 of them as they are made. Under the old rules, the other 300 were “banked” with the grid, and you could draw them back later: in the evening shift, at night, or even months later in the monsoon. You paid a charge for it, but the units weren't lost.
That is what made third-party solar work for Tamil Nadu's two- and three-shift mills. The sun only shines for part of the day; banking stretched it across the whole day.
What the 2025 rules changed
The same TNERC regulations that opened open access to more factories also cut banking back hard:
- Third-party open access: no banking at all. If you buy from a generator you don't own a share of, any unit your factory isn't using at the moment it's generated is lost to you.
- Where banking is allowed, it costs 8% of the banked units, taken in kind: bank 100 units, get 92 back.
- Settlement is monthly, not yearly. Units banked in the sunny months can't be carried into the monsoon.
- Banked units are tied to their time slot. Units banked in normal daytime hours can't be drawn in the evening peak, when grid power costs 25% more. (Units banked during a peak can be used in any slot, but solar makes little power in the peaks.) Whatever is still unused at month-end is paid for at 75% of the renewable tariff.
The good news in the same regulations: the entry bar dropped to 63 kVA of contracted demand for HT and EHT consumers. Many more factories can now take open access. They just need to take it the right way.
What it does to three kinds of factory
Day shift only. Almost nothing changes. If your machines run while the sun shines, you use the solar units as they are made. Banking never mattered much to you.
Two shifts. The afternoon half of your second shift is covered by solar, and the evening half isn't. Unless the solar supply is sized only to your daytime load, you pay for units you can't use.
Round the clock. A solar plant makes nearly all its power in about ten hours of the day. For a flat load running all 24, that means solar can cover at most about 40% of your units, and only if the supply is sized exactly to your daytime draw. Anything more is lost.
The market has already reacted
Mercom's report for the first quarter of 2026 found that new open access solar in Tamil Nadu fell about 74% from the previous quarter and 58% from a year earlier. Buyers and developers did the arithmetic above and stopped signing third-party solar deals that no longer added up.
Yet most vendor websites in the state still describe open access as it worked before the 2025 rules. That's why the first question in any conversation should be about banking.
What still works
1. Rooftop solar first. Power made and used on your own premises never leaves your site, so banking doesn't come into it, and neither do wheeling or the cross-subsidy surcharge. Size it to your daytime load. Zero-investment rooftop solar →
2. Group captive for the rest. If the consumers own at least 26% of the generating company and use at least 51% of its power, they don't pay the cross-subsidy surcharge (₹1.99 a unit for HT I factories under TNERC Tariff Order No. 6 of 2025; solar third-party buyers pay 70% of it, ₹1.39) or the additional surcharge, and banking is still available, with the monthly and time-slot limits above. It needs equity and a yearly check, so your CA will be involved.
3. Wind, or wind plus solar, for the evening and night. Tamil Nadu's wind blows strongest from June to September and often runs into the evening. For a round-the-clock mill, a supply that includes wind matches the load far better than solar alone.
4. Third-party solar, sized small. It can still make sense for the part of your load that runs in daylight, as long as the contract is sized so that every unit is used as it's generated.
Five questions to ask any open access offer
- Which banking rules did you assume in your numbers?
- What happens to the units my factory can't use at the time they're generated?
- Which TNERC order are your charges from, and what date?
- Who carries the risk if the additional surcharge goes up at the next six-monthly revision?
- What does it cost me to leave the agreement early?
A good offer answers all five on paper. Every current charge, with the order it comes from →
This article explains the regulations in plain language; it is not legal advice. Charges and rules change with each TNERC order. Illustrative default values — request a site-specific quotation.
Want to see what this means for your factory?
Send us your last three HT bills and your shift hours. Within two working days you get a one-page sheet: your cost on TNEB today, under third-party open access and under group captive, with the banking rules applied honestly.
Open access in Tamil Nadu