Govt Extends Timeline for Transmission Charges Waiver for RE

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Ministry of Power has issued order today for extension of the waiver of Inter-State Transmission system (ISTS) charges on transmission of electricity generated from solar and wind sources for projects to be commissioned up to 30th June 2025. Further, the order promotes the development of solar, wind, Hydro Pumped Storage Plant (PSP) and Battery Energy Storage System (BESS), trading of RE in the power exchanges and seamless transmission of RE power across the states. 

The waiver of inter-state transmission charges on transmission of the electricity generated from solar and wind sources of energy that was available to solar and wind projects commissioned up to 30th June 2023 has now been extended till 30th June 2025. 

The waiver of Inter- State transmission system (ISTS) charges has also been allowed for Hydro Pumped Storage Plant (PSP) and Battery Energy Storage System (BESS) projects to be commissioned up 30th June 2025. This will promote the Hydro Pumped Storage Plant (PSP) and Battery Energy Storage System (BESS) projects for meeting the balancing requirement of the grid caused due to large scale integration of Renewables in the Electricity Grid ie around 450 GW by 2030.

The waiver of transmission charges has also been allowed for trading of electricity generated/ supplied from Solar, wind, PSP and BESS in Green Term Ahead Market (GTAM) and Green Day Ahead Market (GDAM) for two years i.e. till 30th June 2023.

This is expected to encourage the RE trade in the Power Exchanges. The volume of renewable energy trade in the power exchange is expected to increase further. An opportunity to minimise the curtailment of RE as the RE developers will also have the option to sell power in the power exchanges and get instantly paid on the day of delivery of power itself.  The buyers of Renewable energy will also have an opportunity to sell their surplus power in the power exchanges or allow in advance the sellers to sell in the power exchange.

The order is futuristic as it also allows the waiver of transmission charges for RE trade in the Green Day Ahead Market (as part of the integrated Day ahead market). CERC, POSOCO and the power exchanges are working on it in mission mode to operationalise this product in the power exchanges by end of August 2021.

It has also been clarified that an intra-State transmission system which is used for the conveyance of electricity across the territory of an intervening State as well as conveyance within the State which is incidental to such inter-State transmission of electricity, shall be included for sharing of inter- state transmission charges.  Any waiver of inter-state transmission charges that applies to Inter-state transmission systems shall also be applicable to such parts of the Intra-state transmission. The transmission charges of such Intra-state transmission system shall be reimbursed by the CTU as is being done for ISTS system. Concerned Regional Power Committee may through studies identify such lines.

Thus, India paves way for energy transition from Fossil fuel to Non-fossil fuel by giving incentive for power trade from Renewable, Hydro PSP and Energy Storage. This amendment Order will be a boost to renewable energy and also a step forward to achieve the targets of Government of India in meeting the international obligations towards climate change.

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