The Central Electricity Regulatory Commission (CERC) in India has amended its regulations regarding the sharing of inter-state transmission charges and losses. The amendments include waiving interstate transmission system (ISTS) charges for certain renewable energy generating stations and pumped hydroelectric stations.
The ISTS waiver will apply to renewable energy generating stations (REGS), renewable hybrid generating stations (RHGS), and pumped hydroelectric stations that begin commercial operation by June 30, 2025, and will remain in effect for 25 years. Additionally, battery storage systems that are charged using energy from REGS or RHGS, which begin operating before June 30, 2025, will be eligible for a waiver of transmission charges for 12 years.
Under the amended regulations, solar power projects operating under the Solar Energy Corporation of India (SECI) manufacturing-linked capacity program to sell power to entities with renewable purchase obligations will also be eligible for a waiver of transmission charges for 25 years from their commercial operation date (COD).
Hydro-generating stations with power purchase agreements (PPA) signed between December 1, 2022, and June 30, 2025, and where construction work is awarded by June 30, 2025, will also be eligible for a waiver of transmission charges for 18 years from their COD.
Furthermore, REGS, RHGS, pumped hydroelectric stations, and battery storage systems that begin commercial operation after June 30, 2025, but before June 30, 2028, or new hydro projects where construction work is awarded and the PPA is signed after June 30, 2025, will be eligible for a waiver of transmission charges.
The amended regulations also detail how transmission deviation charges will be calculated for generating stations, battery storage systems, and captive projects, as well as for states and designated ISTS customers. The Transmission Deviation Rate for a state or any other designated ISTS customer located in the state during a billing month will be calculated as 1.25 times the total transmission charges for all drawee ISTS customers situated in the state, divided by the general network access and designated network access quantum of such entities located in the state.
The amendments also clarify that if a connectivity grantee, excluding a renewable power park developer, experiences a delay in achieving COD before the start of connectivity, and the associated transmission system achieves COD, which is not earlier than the start of connectivity, then the connectivity grantee will have to pay yearly transmission charges corresponding to the connectivity capacity that has not achieved COD.
In conclusion, the amendments to the CERC regulations are expected to encourage the development of ISTS projects in India and provide certain renewable energy generating stations and hydroelectric stations with waivers for ISTS charges. The regulations also provide clarity on how transmission deviation charges will be calculated and clarify certain payment requirements for connectivity grantees.