The Assam Electricity Regulatory Commission (AERC) has issued the Draft (Grant of Connectivity to the Intra-State Transmission System) Regulations, 2025,” outlining the processes, criteria, and conditions for granting connectivity to the Intra-State Transmission System (InSTS).

The regulations apply to all applications submitted for connectivity to the InSTS on or after April 1, 2025. They cover power generators, renewable energy developers, distribution licensees, standalone energy storage systems (ESS) operators, and entities involved in cross-border electricity trade. Applications submitted before this date are excluded from these regulations’ scope.

Connectivity will only be granted if the applicants meets the criteria for injecting or drawee entities. In addition to ensuring compliance with technical standards, the framework aligns with the Central Electricity Authority guidelines and other regulatory provisions outlined by the Central Electricity Regulatory Commission.

Eligibility Criteria

Injecting Entities

• Generating stations, including thermal, hydro, and renewable energy generators, with an installed capacity of at least 25 MW. Renewable power park developers are also eligible.
• Standalone ESS, with or without renewable generation, with a minimum installed capacity of 25 MW.
• Captive generating projects injecting at least 25 MW into the InSTS.
• Renewable energy generating stations may seek connectivity through existing generating stations if an agreement exists for sharing infrastructure, including switchyards and transmission lines.

Drawee Entities

• Distribution licensees may applying for connectivity on behalf of the entities connected to their network.
• Drawees directly connected to the InSTS with at least 15 MW load.
• Transmission licensees requiring connectivity for auxiliary power drawal.
• Trading licensees engaged in cross-border trade of electricity.

Application Process and Fee Structure

Applicants must formally apply to the state transmission utility (STU) to initiate the connectivity process. The application must include all relevant details and supporting documents stipulated by the regulations. Applicants must pay a non-refundable application fee of ₹100,000 (~$1,158) and applicable taxes.

Applications submitted during a calendar month will be processed collectively by the end of that month. Upon receipt, the STU will issue an acknowledgment specifying the date and time of submission.

If an application contains deficiencies, the STU will notify the applicant, allowing 15 days to address these issues. Failure to rectify the deficiencies on time will result in the application’s closure. In such cases, 20% of the application fee will be forfeited, while the remaining 80% will be refunded.

Priority and Timeline

Applications will be processed on a first-come, first-served basis unless otherwise specified. Minor deficiencies, such as incomplete technical documentation, do not affect the priority of the application if rectified within the allowed time.

Bank Guarantees

Applicants must submit three types of bank guarantees (BGs) as part of the connectivity process. These BGs ensure financial accountability and safeguard the interests of the transmission system operators.

• Conn-BG1: This is a fixed amount of ₹100,000 (~$1,158)/MW of applied capacity.
• Conn-BG2: The value depends on the voltage level of the terminal bay allocated. For example:

• ₹10 million (~$115,854) for a 33 kV terminal bay.
• ₹20 million (~$231,727) for a 132 kV terminal bay.
• ₹30 million (~$347,563) for a 220/230 kV terminal bay.
• ₹60 million (~$695,181) for a 400 kV terminal bay.
• ₹120 million (~$1.39 million) for a 765 kV terminal bay.

• Conn-BG3: This is calculated at ₹200,000 (~$2,317)/MW for systems requiring augmentation without associated transmission systems.

Applicants must furnish these bank guarantees within one month of receiving in-principal approval—failure to do so will result in the application fee’s forfeiture and closure of the application. In cases, the bank guarantees may be encashed to cover costs incurred by the STU.

Stages of Granting Connectivity

The granting of connectivity follows a two-stage process:

In-Principal Approval

Upon receiving a complete application, the STU will conduct an interconnection study to assess the feasibility of the proposed connection. This study includes determining the requirement of augmentation of the existing transmission system. If no augmentation is necessary, the STU will issue in-principal approval within 45 days. For applications requiring augmentation, the timeline will be extended to 90 days.

Final Approval

After the applicant submits the required bank guarantees, the STU will issue final approval within 30 days. This approval includes detailed technical information, including the single-line diagram and terminal bay location, formalizing the applicant’s connectivity to the grid.

Dedicated Transmission Lines

Connectivity grantees must establish and maintain dedicated transmission lines at their own expense. These lines must meet the technical standards set by the Central Electricity Authority. Renewable power park developers may share these responsibilities under mutually agreed terms with other entities.

Grantees opting to construct terminal bays independently must obtain prior approval from the STU. Costs associated with such construction cannot be claimed for reimbursement in the event of connectivity revocation.

Monitoring and Compliance

Connectivity grantees must provide quarterly progress updates to ensure timely project completion. The updates must cover all work under the grantee’s scope, including the construction of dedicated transmission lines and terminal bays.

The STU will also provide updates on the progress of associated transmission systems and terminal bay construction. This information is made publicly available to maintain transparency and accountability.

Non-compliance with these monitoring requirements or delays in project execution may result in penalties, including the encashment of bank guarantees and revocation of connectivity.

Relinquishing Connectivity

The AERC regulations include a detailed and structured framework for relinquishing connectivity rights. This provision allows entities to surrender their connectivity in part or in full if their requirements change or they cannot comply with the terms of the connectivity agreement. Relinquishment is subject to the following conditions:

Notice Period and Charges

Connectivity grantees must provide written notice of at least 30 days to the STU before relinquishing their rights. The relinquishment charges will be calculated based on the transmission charges for the relinquished quantum, with the following conditions:

Relinquishment of Full Connectivity:

• The grantee will have to pay charges equivalent to 24 times the transmission charges paid by such drawee entity for the last billing month corresponding to the relinquished quantum.

Relinquishment of Partial Connectivity:

• For partial relinquishment, charges will be calculated proportionately for the relinquished quantum.

Reduced Charges for Shorter Connectivity Periods:

• If the remaining period of connectivity is less than 24 months, the relinquishment charges will be reduced accordingly and are limited to the remaining months.

Bank Guarantee Encashment

Bank guarantees provided by the applicant at the time of connectivity application may be encashed under specific circumstances:

• Conn-BG1 will be encashed in full for the relinquished capacity.
• Conn-BG2 will be encashed in proportion to the costs incurred for terminal bays or augmentation already completed or awarded for implementation.
• Conn-BG3 will be encashed in proportion to the quantum of connectivity being relinquished.

The proceeds from the encashed bank guarantees will be adjusted against the outstanding transmission charges or used to reduce the transmission charges for the InSTS system.

Conditions for Relinquishment by Distribution Licensees

Distribution licensees may relinquish connectivity on behalf of drawees connected to their network in the following cases:

• The relinquishment charges will be determined based on the quantum of power drawn by the drawee.
• The charges will be equivalent to 24 months of the drawee’s transmission charges from the last billing month.
• If the drawee substitutes its connectivity with direct connectivity to the InSTS, the relinquished capacity will be deducted from the total connectivity allocated to the distribution licensee.

Partial Relinquishment

The remaining capacity will be governed under the connectivity agreement if partial connectivity is relinquished.  The STU will adjust the connectivity grant to reflect the reduced quantum, issuing a revised grant for the retained capacity.

Relinquishment Timeline

Once the notice period of 30 days expires, the relinquishment becomes effective. The STU updates its records and notifies the connectivity grantee of the revised terms or disconnection, depending on whether the relinquishment is partial or full.

Impact of Relinquishment on Other Entities

The relinquishment of connectivity may impact other grantees sharing the same infrastructure as follows:

• If augmentation or terminal bay construction has been initiated for the relinquished capacity, the costs will be distributed among the remaining grantees.
• The STU may reallocate the released capacity to other applicants, prioritizing entities on the waiting list.

Non-Compliance Penalties

Penalties will be imposed on entities relinquishing connectivity without paying the required charges or failing to notify the STU within the specified timeline. These penalties include:

• Encashment of all bank guarantees submitted by the grantee.
• Revocation of connectivity rights for the entire capacity.

Connectivity Revocation

The STU can revoke connectivity under the following circumstances:

• Failure to achieve the commercial operation date specified in the connectivity agreement.
• Termination of power purchase agreements or letters of award that formed the basis for connectivity.
• Non-payment of transmission charges for more than three months.

Revocation will result in the encashment of bank guarantees, with the proceeds used to cover transmission charges or other liabilities.

In September 2024, AERC released draft guidelines for implementing group net metering and virtual net metering frameworks for renewable energy systems. These guidelines, which will become effective upon issuance, aim to promote the adoption of renewable energy and provide more flexible options for consumers.

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