Electricity is at the core of every modern business. Many large consumers in India now have choices beyond their local distribution company (Discom) — thanks to Open Access, they can buy power directly from competitive markets or generators, often at lower rates and with the flexibility to choose green energy.
Open Access is the freedom for eligible electricity consumers to buy power from the supplier of their choice, rather than being tied only to their area’s Discom. Under this system, businesses can:
Buy from power exchanges like IEX, PXIL, or HPX.
Sign bilateral contracts with generators or electricity traders.
This mechanism was introduced by the Electricity Act 2003, aiming to intensify competition, lower electricity costs for large consumers, and support a more efficient power sector.
Eligibility depends on rules set by each state’s regulator, but typically includes:
Large Commercial & Industrial (C&I) Consumers: Businesses with a contract demand above 1 MW can apply.
Medium Industries: Certain states now allow 500 kW and above, especially under newer "Green Open Access" rules.
Distribution Licensees: Even Discoms can use Open Access to source cheaper power from the market.
If you're operating a factory, data center, hospital, or commercial building with significant electricity demand, you could be eligible to benefit.
Short-Term (up to 1 month): Usually via power exchanges; flexible and suited for quick procurement.
Medium-Term (3 months to 3 years): Direct bilateral deals with suppliers for more stable access.
Long-Term (more than 7 years): Commonly used for renewable Power Purchase Agreements (PPAs), enables dedicated green energy sourcing.
Lower Costs: Market prices can be 10–20% lower than the local Discom’s tariff, notably during off-peak hours.
Green Energy Access: Green Open Access lets businesses buy solar or wind power directly, helping them meet sustainability targets and reduce their carbon footprint.
Choice & Flexibility: Consumers can negotiate rates, switch suppliers, and diversify their power portfolio as easily as changing internet providers.
Transparency: Power exchange prices are public and determined by market forces, unlike regulated rates, providing clarity on costs.
Surcharges & Fees: States impose cross-subsidy surcharges (CSS), wheeling charges, and more, which can affect cost savings.
Regulatory Approvals: Approval times and application complexity vary by state, with some requiring additional metering and grid compliance.
Minimum Load: Small and medium businesses under the threshold cannot typically access open access directly, unless via group captive or green OA structures