CERC Notifies ISTS Charges Waiver for Renewable Energy Projects
ISTS charges have been waived for renewable energy projects commissioned by June 30, 2025
March 10, 2023
The Central Electricity Regulatory Commission (CERC) has amended the CERC (Sharing of Inter-State Transmission Charges and Losses) Regulations, 2020, waiving interstate transmission system (ISTS) charges for renewable energy generating stations (REGS) and pumped hydroelectric stations beginning commercial operations by June 30, 2025.
The ISTS waiver is among the various amendments contained in the CERC (Sharing of Inter-State Transmission Charges and Losses) (First Amendment) Regulations, 2023.
ISTS charges will be waived for REGS, renewable hybrid generating stations (RHGS), and pumped hydroelectric stations that will commence commercial operation by June 30, 2025. This waiver will remain in effect for 25 years.
Battery storage systems that are charged using energy from REGS or RHGS, which start operating before June 30, 2025, will be eligible for a waiver of transmission charges for 12 years.
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 the 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 be eligible for a waiver of transmission charges for 18 years from COD.
REGS, RHGS, pumped hydroelectric stations, and battery storage systems that go into 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.
For a generating station, including energy storage systems and captive projects, the transmission deviation will be the net metered ex-bus injection in a time block in excess of such entities’ general network access (GNA).
However, for a hydro-generating station, schedules for overload capacity, as permissible under the Grid Code during peak season, will not be considered for computing the transmission deviation.
Transmission deviation charges will not be levied for over-injection by a generating station, subject to verification of such over-injection by the regional power committee (RPC) concerned. Each RPC must issue guidelines for furnishing the data by the generating stations regarding their primary response.
For a state, transmission deviation in a time block will be the net metered drawal over the sum of GNA and T-GNA for all designated ISTS customers (DIC), which are intra-state entities in that state.
However, where a state has net metered injection in a time block, transmission deviation in a time block will be net metered injection over the sum of GNA for all drawee intra-state entities in the state, GNA for injecting intra-state entities, and T-GNA for injecting intra-state entities.
For a drawee DIC, which is a regional entity not covered under state GNA, transmission deviation will be net metered drawal in excess of the sum of GNA and T-GNA of the said entity.
For a drawee DIC, a regional entity with GNARE or T-GNARE, transmission deviation in a time block will be net metered drawal in excess of the scheduled drawal under GNARE and T-GNARE from identified sources. However, if such an entity obtains additional GNA or T-GNA, transmission deviation in a time block will be net metered drawal in excess of the sum of [scheduled drawal under GNARE and T-GNARE from identified sources + quantum of GNA + quantum of T-GNA].
The Transmission Deviation Rate in ₹/MW for a state or any other DIC located in the state for a time block during a billing month will be computed as 1.25 X total transmission charges for all drawee DICs situated in the state in rupees divided by GNA and GNARE quantum in MW of such entities located in the state for the corresponding billing period X number of days in a month X 96.
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.
However, if a connectivity grantee is a renewable power park developer and the generation capacity within the renewable power park has not declared COD before the start date of connectivity, but the associated transmission system achieves COD, then the renewable power park developer will have to pay yearly transmission charges corresponding to the generation capacity that has not attained COD.
The yearly transmission charges for the associated transmission system corresponding to the connectivity capacity that has achieved COD will be included in the determination of transmission charges of DICs.
If a dedicated transmission line has already been constructed or is under construction by an inter-state transmission licensee under coordinated transmission planning of the central transmission utility, and the connectivity grantee has not achieved COD on or before COD of the dedicated transmission line, then the connectivity grantee will have to pay yearly transmission charges to the inter-state transmission licensee from the COD of the dedicated transmission line until the COD of such connectivity grantee is achieved.
If a regional generating station draws start-up power before COD or draws auxiliary power before or after COD through ISTS, then it will have to pay transmission charges for such drawal at the TGNA rate for the state in which it is located. The amount received in a billing month will be reimbursed to the drawee DICs in proportion to their share in the first bill in the following billing month.
This notification is expected to encourage the development of ISTS projects in the coming quarters. This waiver will provide significant cost savings to open access consumers, particularly commercial and industrial units, who could save around ₹0.50(~$0.006)/kWh in ISTS charges when procuring renewable power.
The Ministry of Power recently issued an order waiving ISTS charges on evacuating electricity from new hydropower projects in the country.
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