# How is the captive limit worked out when a parent company and its subsidiaries draw power from the same plant?

Canonical: https://senseible.earth/answers/parent-and-subsidiaries-one-captive-user-schedule-iii-example

They count as one captive user, and the limit is set for the group, not for each company. In Schedule III Example 4 the group owns 22% and draws 60%, but only 48.12% qualifies. The group decides how to share that figure among its companies.

## Who is in the group

Rule 3(2)(d)(v): for calculating proportionate consumption, "a captive user, its subsidiary or subsidiaries, its holding company, and any other subsidiary or subsidiaries of such holding company shall be collectively treated as a single captive user". The explanatory note adds that the proportionate consumption requirement "will not apply to any individual entity within this combined group".

## How the shares are split

Schedule III, Note A to Example 4: "Allocation of the eligible collective captive consumption among group entities shall be determined by the group, subject to the collective eligibility limit." Draw above the group limit "does not qualify as captive consumption".

## The 26% exemption

In the example the group holds 22%, under 26%, so the group's cap applies. A group holding not less than 26% would fall under Rule 3(2)(d)(iii), if its combined holding counts as one user's ownership (my reading).

## Schedule III, Example 4

- Ownership: Group (A) 22%, B 4%, C 6%, so X = 32. A's other group companies hold 0%. In the rules' example A1 is A's holding company, A2 is A's subsidiary and A3 is a subsidiary of A1.
- Consumption: Group 60% (A1 30, A2 5, A3 25), B 6%, C 4%, so Y = 70, which meets the 51% test
- Limits: Group 70 x 22/32 = 48.125, printed as 48.12%. B 70 x 4/32 = 8.75%. C 70 x 6/32 = 13.125, printed as 13.12%.
- The group draws 60% against 48.12%, so about 11.88 points do not qualify. B at 6% and C at 4% are within their limits.

Figures are the rules' own, printed in Schedule III, with the source's rounding.

## What Senseible does here

Senseible reads electricity bills into monthly records. It does not test captive status or work out the limits.

- [Group companies and the Renewable Consumption Obligation](https://senseible.earth/answers/rco-group-companies-holding-level-compliance)
- [Captive plant fails the 51% test](https://senseible.earth/answers/captive-plant-fails-51-percent-test-what-happens)
- [Group captive rules for solar](https://senseible.earth/answers/group-captive-solar-26-percent-rule)
- [Group captive solar and Scope 2](https://senseible.earth/answers/group-captive-solar-scope-2)
- [Free carbon calculators](https://senseible.earth/calculators)

Sources: [Electricity (Amendment) Rules, 2026, General Statutory Rules (G.S.R.) 186(E), substituting rule 3 of the Electricity Rules, 2005 (captive generating plants), with Schedule III and the Ministry of Power explanatory note](https://www.powermin.gov.in/static/uploads/2026/05/c84c643ff478be845cff8d7dd4349d67.pdf)

Last reviewed 2026-11-05. Rule 3 of the Electricity Rules, 2005 as substituted by G.S.R. 186(E), 13 March 2026; parts in force from 1 April 2026. Checked 5 November 2026. Check the state nodal agency's or the National Load Despatch Centre's procedure before you file.