Karnataka Wants 43.33% Green Power by FY2030: What the Draft RPO Means for Your Factory

Published Nov 5, 2026

Rooftop SolarPolicy

35.95% today. 43.33% by the end of the decade.

That is the renewable energy share Karnataka's power regulator wants large open access and captive power users to meet under a new draft. If your factory buys power through open access, or runs a captive plant of 1 MW or more, this draft could set your energy plan for the next four years.

If you only buy from your discom (distribution company), the draft is not reported to bind you directly. It still matters, because it shows where the state is heading, and Karnataka's rooftop rules were rewritten just two months earlier.

Here is what is proposed, who is covered, and what to do before the comment window closes.

What did Karnataka's regulator propose?

The Karnataka Electricity Regulatory Commission (KERC) has proposed raising the state's Renewable Purchase Obligation (RPO) from 35.95% in 2026-27 to 43.33% in 2029-30. An RPO is the minimum share of your electricity that must come from renewable sources.

The draft is called the KERC (Procurement of Energy from Renewable Sources) Regulations, 2026. SolarQuarter reports that it was published in the Gazette on 22 October 2026 and would replace the 2011 regulations. Mercom India confirms the start and end targets.

Financial year	Proposed total RPO	Renewable units needed per 1 crore units consumed
2026-27	35.95%	35.95 lakh
2027-28	38.81%	38.81 lakh
2028-29	41.36%	41.36 lakh
2029-30	43.33%	43.33 lakh

This is a draft, not a final rule. The numbers can change after stakeholder comments.

A note on sourcing: this article rests on published reports of the draft. We have not read the full draft text, so confirm the details against the KERC notification before you commit money.

Does the Karnataka RPO draft apply to my factory?

It applies to your factory if you are an open access consumer with a contracted demand of 1 MW or above, or if you use a grid-connected captive power plant of 1 MW or above. Distribution licensees are also covered.

A simple way to check where you stand:

Open access consumer, 1 MW or more: covered, as reported.
Grid-connected captive plant, 1 MW or more: covered, as reported.
Open access or captive below 1 MW: outside the reported thresholds.
Regular discom consumer, with or without rooftop solar: not named in the reported list of obligated entities. Your discom carries its own obligation.

Open access means buying power from a supplier other than your discom, using the grid to deliver it. Captive means power you generate largely for your own use. Our guide to rooftop solar vs open access solar compares the two routes.

What are the four RPO categories, and why do they matter?

The total target is split into four buckets: Wind, Hydro, Distributed and Other Renewable Energy. Reports of the draft do not give the percentage for each bucket, so check the draft itself for your exact number.

Distributed: projects below 10 MW, including rooftop solar.
Wind and Hydro: generally from projects commissioned after 31 March 2024.
Other: includes older wind and hydro projects commissioned before 1 April 2024, plus some biomass sources.

The key detail is this: a surplus in one category can offset a shortfall in another, except that a Distributed deficit cannot be offset by other sources, according to SolarQuarter's report.

That puts distributed renewable power, including rooftop solar, in a protected position. Buying more wind would not close a gap in the Distributed bucket. If this clause survives, an obligated company may need to plan specifically for projects under 10 MW.

How can a covered company meet the obligation?

The draft lists five routes. A covered company can use any mix that fits its situation:

Buy renewable power directly.
Buy renewable power linked to storage.
Generate captively, from plants of at least 250 kW.
Buy or self-generate RECs (Renewable Energy Certificates) through mechanisms registered with the central regulator, CERC.
Pay the buyout price set by CERC.

Certificates and buyout payments can tick the compliance box. They do not cut your power bill. Physical renewable power can do both, which is why it is usually the first route worth modelling.

Reports do not spell out how rooftop solar under each ownership model is credited against an individual company's target. Ask for this to be clarified, or raise it in your comments, if a third-party owned plant is part of your plan.

What happens if a company misses the target?

Non-compliance may lead to proceedings under Section 142 of the Electricity Act, 2003. Reports do not state a fixed penalty amount in the draft.

The reporting cycle is already defined. Covered companies would submit consumption and procurement data by 31 July after each financial year, and the monitoring agency would report to KERC by 31 August. So you would need clean records of what you consumed and procured, every year.

How much extra renewable power would a factory need by 2030?

For every 1 crore units consumed each year, the proposed rise from 35.95% to 43.33% means 7.38 lakh more renewable units a year. That extra share alone is roughly what a 490 kW rooftop plant in Bengaluru could generate.

The working, for a factory with steady consumption:

Obligation in 2026-27: 35.95 lakh units.
Obligation in 2029-30: 43.33 lakh units.
Increase: 7.38 lakh units a year.
Yield assumption: 1,500 units per kW a year, the mid-point of the 1,450 to 1,550 range one industry guide gives for Bengaluru.
Result: about 490 kW.

This is an illustration, not a design. Actual generation depends on your roof, tilt, shading and maintenance. It also assumes the rooftop units count fully towards your target, which you should confirm once the final text is out.

What else changed for rooftop solar in Karnataka this year?

Karnataka notified new rooftop rules in August 2026. All consumer categories can now use net metering, up to their sanctioned load or contracted demand, or 1,000 kW, whichever is lower. Net metering means power you export to the grid is set off against power you import.

These are the points that matter most to a C&I (commercial and industrial) buyer, from the KERC Distributed Solar Regulations, 2026:

No storage mandate for now. Battery storage is optional. KERC will review this after two years, or when distributed solar reaches 3 GW, whichever comes first.
Behind-the-meter is allowed up to sanctioned load. This means the plant serves only your own use and sells nothing to the grid. It needs prior intimation to the discom and a reverse power flow relay.
Net surplus is settled monthly. Excess energy is bought by the discom at the tariff KERC sets.
Grid limits still apply. Plants under 150 kW connect only to the existing distribution transformer that serves you, so local capacity can decide your plant size.

Why does this make rooftop solar worth a fresh look in Karnataka?

Because the gap between what you pay the grid and what the grid pays for your surplus is wide. Solar units you use yourself are worth far more than surplus units you sell.

Item	Rate	Source
HT-2a industrial energy charge	₹6.70 a unit (demand charge ₹365 per kVA)	PTI via ThePrint
HT-2b commercial energy charge	₹6.90 a unit (demand charge ₹390 per kVA)	PTI via ThePrint
KERC generic tariff, non-DCR plants	₹2.34 a unit	Energetica India
KERC generic tariff, DCR plants	₹3.11 a unit	Energetica India

DCR stands for Domestic Content Requirement, meaning plants built with Indian-made modules. Energetica reports these generic tariffs apply from 25 August 2026 until 30 June 2029, or until further orders.

The energy-charge rates above come from the KERC order of 3 March 2026 on a review petition. Check your own bill and category for the current rate; our guide on how to read your factory's electricity bill shows where to look.

The takeaway is simple: every solar unit used on site avoids around ₹6.70 on an HT-2a connection. So size your plant around what you use, not around how big your roof is.

What should a Karnataka factory do before the comment window closes?

Find out which group you fall in. Check your contracted demand and whether you use open access or a captive plant.
Work out your renewable position. Add up the renewable units you consumed last year, by source and project date if possible.
Look at your roof again. A rooftop plant is a project under 10 MW, so it falls in the Distributed bucket as described in reports of the draft.
Raise your questions with KERC. Ask how third-party owned rooftop solar is credited, and what the Distributed share is for your category.
Model OPEX as well as CAPEX rooftop solar. Under the OPEX or RESCO model (Renewable Energy Service Company), a developer funds, builds, owns and maintains the plant, and you pay per unit with zero upfront cost. Our CAPEX vs OPEX rooftop solar comparison walks through both.

Even if you are below the 1 MW line, the bill maths above stands on its own. The obligation is one reason to act. The tariff gap is the bigger one.

FAQ

Is Karnataka's 43.33% RPO final?

No. It is a draft published in the Gazette on 22 October 2026, open for stakeholder comments for 30 days. The final numbers could change.

Who must meet the Karnataka RPO?

As reported, distribution licensees, open access consumers with contracted demand of 1 MW or above, and consumers using grid-connected captive plants of 1 MW or above.

Does rooftop solar count under the draft?

Reports say the Distributed category covers projects below 10 MW, including rooftop solar. How a specific plant's units are credited to an individual company should be confirmed in the draft text.

Can buying wind power cover a Distributed shortfall?

As reported, no. A surplus in one category can offset a shortfall in another, but a Distributed deficit cannot be offset by other sources.

Do I need a battery with rooftop solar in Karnataka?

Not under the August 2026 regulations. Storage is optional, and KERC will review the position after two years or at 3 GW of cumulative distributed solar, whichever comes first.

About SustVest

SustVest (SolarGridX Ventures Pvt Ltd) is a CRISIL Top-10 rooftop solar developer in India, running 80+ distributed solar plants (about 30 MW) across 13 states for commercial and industrial clients. Under its OPEX/RESCO model, SustVest funds, builds, owns and maintains the plant, and you pay a lower per-unit tariff with zero upfront cost. Want to see what the numbers look like for your site? Talk to the SustVest team.