BERC notifies new intra state deviation settlement regulations

The Bihar Electricity Regulatory Commission (BERC) has issued the final BERC (Deviation Settlement Mechanism and Related Matters) Regulations, 2025 on 06 January 2026 after completing a public consultation process. The regulations align Bihar’s intra state deviation framework with the Central Electricity Regulatory Commission (CERC) (Deviation Settlement Mechanism and Related Matters) Regulations, 2024. They replace the 2020 regulations and will come into force from 1 June 2026, with a transition period for system and procedural changes.

The Commission initiated the revision following amendments introduced by CERC to its deviation settlement framework. In its Statement of Reasons, BERC said the central regulator had updated commercial principles to reflect recent developments and emerging market realities in the power sector. BERC, therefore, considered it necessary to align the existing intra state regulations with the prevailing central framework. A draft of the regulations was issued for stakeholder comments in August 2025, followed by public hearings in September 2025.

The regulations define their scope of applicability. The Deviation Settlement Mechanism (DSM) will apply to all grid connected state entities, including distribution licensees, deemed licensees, and open access consumers connected to the intra state transmission system. The regulations also apply to renewable energy based generating stations connected to the intra state transmission system with an exportable capacity of 1 MW or more. This reflects partial acceptance of stakeholder comments seeking wider coverage, although the final threshold was set at 1 MW instead of the proposed 5 MW.

BERC has prescribed detailed methodologies for the computation of deviations and associated charges, linked to system frequency and deviation volume. Charges are referenced to a Normal Rate derived from power exchange prices. For example, charges for buyer over drawal during low system frequency can reach 150% or 200% of the Normal Rate, depending on the extent of deviation. The Commission declined requests to lower these penalties, stating that the provisions are consistent with the CERC regulations as amended from time to time.

The final regulations incorporate several stakeholder suggestions. A new provision requires adjustment of intra state generator schedules for Secondary Reserve Ancillary Services and Tertiary Reserve Ancillary Services transactions during DSM account preparation. The Commission also accepted the need for an implementation window, noting that the State Load Despatch Centre (SLDC) will need time to configure information technology systems, update procedures, train personnel, and coordinate with stakeholders to avoid billing disputes. In addition, the regulations formalise the role of Qualified Coordinating Agencies (QCAs) for aggregation of renewable energy generators, with specified responsibilities for energy accounting and settlement.

Financial settlement will be managed through a State Deviation Pool Account maintained by the SLDC. Deviation charges are payable within ten days from issuance of the statement, with a late payment surcharge of 0.04% per day. Any surplus in the pool account will be utilised with 50% reimbursed to state entities that paid supplementary charges during the quarter, while the remaining amount will be used for grid improvement and capacity building, subject to Commission approval.

The Commission has directed its secretariat to publish the BERC (Deviation Settlement Mechanism and Related Matters) Regulations, 2025 in the Official Gazette, formally bringing the revised intra state deviation settlement framework into effect in Bihar.