Green Energy Banking in Madhya Pradesh: The 30% Cap Explained

What banking is

Solar generation and industrial consumption rarely match hour for hour. Banking lets the surplus you inject into the grid during solar hours be credited back against your consumption at other times, within limits the regulator sets. Without banking, every surplus unit is sold to the DISCOM at a low rate or lapses; with it, that unit offsets a grid unit you would otherwise buy at full tariff.

The MPERC SOP, August 2026

The standard operating procedure finalised by MPERC in August 2026 (summarised by Vyqon; the regulations are on the MPERC site) sets out the mechanics:

Monthly cap: banked energy is limited to 30% of the consumer's total monthly consumption from the DISCOM. Surplus above the cap is scaled down by a reduction factor.
In-kind charge: 8% of the banked units are deducted as the banking charge.
Rolling cycle: energy banked in a month must be used within the following two months; what is left at the end of the three-month cycle lapses. The generator may claim renewable energy certificates on lapsed energy.
Time blocks: accounting is in 15-minute blocks. Energy banked in peak periods can be drawn in any period; energy banked off-peak can only be drawn off-peak.
Default: a consumer event of default has a 7-day cure period, after which the banking arrangement terminates.

What this does to plant sizing

Before the SOP, a developer could size a plant to a consumer's total annual consumption and rely on banking to absorb the mismatch. Under a 30% cap the arithmetic changes:

A single-shift daytime plant is barely affected. Most generation is consumed as it arrives and banking is a small residual.
A two-shift plant with, say, 55% of consumption in solar hours can still absorb a plant sized to about 55% + 30% = 85% of its consumption, less the 8% charge on the banked portion.
A three-shift or night-heavy plant with 35% daytime consumption should size to roughly 60–65% of consumption, not 100%. Oversizing beyond that turns into lapsed energy and a worse blended tariff.

This is the reason our feasibility notes state a daytime share on the first page. It is the number that decides plant size, and plant size decides the tariff.

Peak and off-peak matter more than they look

Because off-peak banked energy can only be drawn off-peak, a plant that banks mainly during midday (which MPERC treats favourably) has flexibility, while a wind or hybrid plant banking at night does not. For solar this rule is largely benign; for a solar-wind hybrid it needs modelling before anyone signs a tariff.

How we treat banking in a quote

We assume the 30% cap and the 8% charge as written, we assume lapsed energy is worth zero to you, and we size the plant to the daytime share plus the bankable margin. The result is a smaller plant and a slightly higher tariff than a quote that ignores the SOP, and a saving that survives the first year's true-up. See how the numbers combine in our FY2026-27 open access cost guide, or send your bills for a free reading that states your daytime share.

Questions on this topic

What is the banking limit for solar open access in Madhya Pradesh?

Under the MPERC standard operating procedure finalised in August 2026, banked energy is capped at 30% of the consumer's total monthly consumption from the DISCOM, with an 8% in-kind banking charge and a three-month rolling utilisation cycle.

Does banked solar energy lapse in MP?

Yes. Energy banked in a month must be used within the following two months. Surplus left at the end of the three-month cycle lapses, and the generator may claim renewable energy certificates for it.

Green energy banking in Madhya Pradesh: what the 30% cap means for your solar plan