The aim is to enhance transparency and accountability within the power generation and consumption system in Telangana. The new procedure mandates that all CGPs and their users apply to the distribution licensee for verification of their captive status, with a consolidated report submitted to TGERC by June each year.

Under the updated regulations, if a CGP or its users fail to meet the required criteria, such as ownership and electricity consumption, they will lose their captive status for that year. However, other users within the same CGP who meet the necessary criteria can retain their captive status.

For a CGP to qualify as "captive," its users must collectively hold at least 26% of the equity share capital with voting rights and consume at least 51% of the electricity generated annually. These requirements extend to cooperative societies, special purpose vehicles (SPVs), and partnership firms, all of which must adhere to the same ownership and consumption rules.

The verification process will review electricity consumption, including consumption through energy storage systems. CGPs and their users must submit an affidavit by May 31 each year, detailing their electricity generation, consumption, and equity shareholding for the previous financial year. The distribution licensee will then analyze the data and submit a consolidated report to TGERC.