Green energy open access vs group captive: how to choose

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Most plant and energy teams that want green power reach the same fork. Do we buy it from a developer through open access, or do we invest in a plant with other users and take the power as captive?

There is no single right answer. The choice depends on your load, your appetite for equity, how long you can commit, and how the charges fall for your site. In the end it is a numbers question, which is why we treat it as part of financial modelling and regulatory risk. This guide sets out the rules that shape those numbers, without quoting charge figures that change during the year.

The two routes in plain words

Open access from a third party. You buy power from a generator or trader other than your distribution company (discom), and the grid carries it to your site. You pay the grid and surcharge charges that apply.

Captive and group captive. Section 9 of the Electricity Act, 2003 lets any person build and run a captive generating plant. A captive owner has a right to open access to carry that power to its own use, subject to transmission capacity. In a group captive arrangement, several users share ownership of one plant, often through a company set up for that purpose. Each user must fit within the captive rules.

Who can use each route in Gujarat

The Green Energy Open Access Rules, 2022 (G.S.R. 418(E), 6 June 2022) set the central framework. Under these Rules, as amended, a consumer with a contracted demand or sanctioned load of 100 kW or more can seek green energy open access. Captive consumers have no load limit.

In Gujarat, the Gujarat Electricity Regulatory Commission (GERC) applies this through the GERC (Terms and Conditions for Green Energy Open Access) Regulations, 2024 (Notification No. 08 of 2024). They use the same 100 kW threshold and have been amended several times, most recently in 2026.

The captive tests

A plant counts as captive only if it meets two tests set in rule 3 of the Electricity Rules, 2005:

  1. Ownership: captive users hold at least 26% of the ownership.
  2. Consumption: at least 51% of the plant's annual output is consumed for captive use.

A 2023 amendment brought holding and subsidiary companies into the test. On 13 March 2026, the Ministry of Power notified the Electricity (Amendment) Rules, 2026, which replace rule 3. The 26% and 51% tests continue. The new rule changed how group companies and associations of users are tested. Any group captive structure, existing or planned, should be checked against the rule as it now stands.

Captive status is verified every year under a prescribed procedure. This matters because the Act's exemption from cross-subsidy surcharge (the proviso to section 42(2)) covers only a captive generator carrying power to its own use. If a structure does not meet the tests in a year, that exemption is not available for that year's supply.

One point is often misstated. The Act itself exempts captive use from cross-subsidy surcharge only. Additional surcharge treatment for captive users comes from the Electricity Rules, not from section 42 of the Act. Check the current rule text for your case.

The charges you are comparing

Under the GERC open access regulations, the charge heads are:

  • transmission charges;
  • wheeling charges and losses;
  • cross-subsidy surcharge (CSS);
  • additional surcharge (AS);
  • standby charges;
  • banking charges;
  • scheduling and other fees.

Each is set in a different place, and each can change:

ChargeWhere it is set
Wheeling charges and CSSGERC tariff orders for each discom. The FY 2026-27 orders were issued on 25 March 2026.
Additional surchargeGERC orders issued every half-year.
Banking chargeGERC regulations, revised by amendment.
Banking limitsGERC regulations. They are currently the subject of proceedings before GERC.
Transmission and SLDC chargesGERC multi-year tariff orders for the transmission company and the State Load Despatch Centre.

We do not print the figures here. They change during the year, and some recent changes are not yet confirmed on GERC's website. Any comparison should state the order or regulation behind each figure, and the date it was checked.

How to choose: six questions

QuestionPoints toward third-party open accessPoints toward group captive
Can your company invest equity in a plant?No, or not nowYes, as part of a group of users
Is your consumption steady across the year?Load is seasonal or uncertainLoad is steady enough to support the consumption test
How long can you commit?You want shorter or more flexible termsYou can commit for the life of the plant
How much do surcharges weigh in your landed cost?Less, or the supplier's offer already covers itMore, so the CSS exemption matters
Can you manage yearly verification?You prefer the supplier to carry the paperworkYou can keep ownership and consumption records each year
How exposed are you to rule changes?You want the supplier to take more of the riskYou accept that captive rules and charges can change

These are judgements, not legal tests. Several of them only become clear once you put current charges into a model for your own site.

Illustrative example

Two plants in Gujarat both want green power. Plant A runs three shifts all year, and its parent group is willing to take an equity stake in a shared solar plant. Plant B has seasonal load and does not want to invest equity. For Plant A, group captive is worth modelling first, along with the work of meeting the tests every year. For Plant B, third-party open access may fit better. Neither answer is final until each plant's landed cost is modelled on the current GERC orders.

Why the comparison needs a model

The routes differ in charges, in commitment and in regulatory risk. A sound comparison labels each regulatory input as notified, draft, under petition or announced, and tests which assumptions move the result most. For the rules behind each route, see green energy open access and captive power advisory.

Sources

Official sources. The date after each link is when we last checked it.

Not legal advice. This article is general information, not legal advice. It is written without knowledge of your specific facts, and it does not say that any rule applies, or does not apply, to you. Adynta Consulting is not a law firm. This article states the position as at 2 November 2026, and each source above shows when it was last checked. Always confirm against the official text.

Compare the routes for your site

Adynta Consulting models both routes for your site, with each regulatory input sourced, dated and labelled by status, so that you can see which assumptions decide the answer. We do not promise savings or outcomes.

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