CERC Proposes Grid Code Amendment 2026 To Tighten Congestion Charges And Payment Default Rules

The Central Electricity Regulatory Commission (CERC) has issued a draft notification proposing the Indian Electricity Grid Code (Second Amendment) Regulations, 2026, aimed at strengthening grid security, streamlining power scheduling, updating project trial-run procedures and introducing measures for transmission congestion and payment defaults. The draft was issued on September 21, 2026, and most provisions will take effect from the date of publication in the Official Gazette. Changes relating to operational timelines under Para 16(B) are proposed to take effect from April 1, 2027.

The draft introduces new definitions, including Central Hydro Generating Stations (CHGS), Renewable Energy Implementing Agencies (REIA) and Congestion Charges. It also establishes a Default Trigger Date for entities failing to clear statutory dues. For unpaid accounts, the date will generally be 75 days after the Regional Power Committee issues the account. In cases where payment security mechanisms are not replenished, the trigger date will be the next bank working day.

The proposed regulations provide a framework for imposing congestion charges on regional entities responsible for congestion in inter-regional or intra-regional transmission links. This may include over-drawal, under-injection, under-drawal or over-injection. The National Load Despatch Centre and Regional Load Despatch Centres will issue warning notices when transmission flow exceeds the Available Transfer Capability. Congestion charges will be imposed if the flow exceeds the Total Transfer Capability.

Entities liable for congestion charges will have to deposit the amount into the designated pool account within 10 days. Delayed payments will attract interest at 0.04% per day.

CERC has also proposed stricter measures against entities defaulting on charges such as Deviation Settlement Mechanism (DSM), congestion charges and reactive energy charges. After the Default Trigger Date, scheduling under Temporary General Network Access (T-GNA) will be regulated and subsequently suspended. If the default continues for two months, short-term contracts under General Network Access (GNA) will also face complete regulation. Access associated with non-short-term contracts will be reduced progressively by 5% every month until the outstanding dues are cleared.

The draft also proposes changes to trial runs and commercial operation procedures. Entities seeking extensions for power interchange will need to submit applications at least 10 days in advance. RLDCs may grant cumulative extensions of up to three months.

For generating projects of 250 MW or more, trial runs may be conducted in partial-capacity blocks of at least 50 MW. Specific trial-run provisions have also been proposed for standalone Energy Storage Systems and Pumped Storage Plants. During PSP trials, brief interruptions will be permitted, subject to a cumulative limit of four hours.

Scheduling of infirm power before COD will be permitted only after successful completion of the required trial runs. Such scheduling will have to comply with existing contractual arrangements or provide the contracted buyers with a first-refusal opportunity through seven days’ notice.

The amendment further proposes a framework for state governments to schedule, sell and account for their free-power entitlement from Central Hydro Generating Stations directly from the bus bar. CERC has also proposed changes to Unit Shut Down and Security Constrained Unit Commitment procedures, enabling NLDC to commit or decommit generating units in real time to maintain grid balance and security.