DG Set Registration & Electricity Duty Exemption for Manufacturing Units in Gujarat

For manufacturing units in Gujarat, a Diesel Generator (DG) set is not optional — it is a critical backup that keeps production running when grid power fails. But most businesses focus entirely on getting the unit installed and running, and skip two things that matter equally: proper registration with the relevant authorities, and claiming the electricity duty benefit they are entitled to on the power their DG generates.

Both are manageable. Both are commonly missed.

The Compliance Side

Using a DG set isn’t just about installing it and running it.

There are regulations involved.

• Before commissioning a DG set, registration with the Electrical Department is mandatory under Gujarat’s electricity regulations.
• Certain approvals have to be in place

Most businesses are aware of this… but don’t always complete it properly.

And that can create issues later.

Electricity Duty on DG Set Generation — What You Are Entitled To

Under the Gujarat Electricity Duty Act, electricity duty is applicable on power generated by a DG set and consumed within your own manufacturing unit. However, eligible manufacturing units are entitled to a significant reduction in this duty — and in some cases, a full exemption.

Here is how the benefit is structured:

How long does the benefit last?

For new manufacturing units in Gujarat, the exemption applies for 5 years from the date of commercial production in regular industrial areas, and up to 10 years for units in SEZs or notified special zones. Existing units undergoing significant expansion may also qualify under applicable conditions.

This benefit applies specifically to power generated by your DG set for your own captive use — not to grid-supplied electricity.

Where Things Usually Slip

Most manufacturing units install DG sets quickly to solve immediate power needs — registration gets delayed, and the electricity duty exemption, which has a strict filing window tied to your commercial production date, is never explored. The unit keeps running, but the benefit is lost.

How We Help

At Neoapex, we handle the complete process — from ensuring your DG set registration is in order to filing for the applicable electricity duty exemption on your captive generation.

We assess your unit’s eligibility based on your DG set capacity, your location, and your commercial production date. We identify the correct benefit structure that applies to your situation, prepare the required documentation, and ensure the filing is done within the applicable window.

What this covers:

DG Set Registration Ensuring all required approvals and compliance steps are completed before or shortly after commissioning — so your unit is legally in order from the start.

Electricity Duty Exemption on Captive Generation Confirming your eligibility, calculating the applicable benefit based on your DG set capacity, and filing within the required timeline from your commercial production date.

Documentation & Follow-Up Preparing and submitting all required documents correctly, and following up with the relevant departments until the process is complete.

A Practical Advantage

When your DG set is properly registered and the electricity duty benefit is in place, you operate without compliance risk and with a reduced duty burden on every unit of power your DG generates.

For a manufacturing unit running DG operations regularly, this is not a one-time saving. It is a recurring benefit that accrues over your entire exemption period — 5 years in most cases, longer in notified zones.

Getting the registration right and filing the exemption on time is what determines whether that benefit reaches you or not.