CERC Revises Grant of Connectivity Guidelines for ISTS-Connected Renewable Projects

The Central Electricity Regulatory Commission (CERC) has approved the revised guidelines for the grant of interstate transmission system (ISTS) connectivity to renewable energy projects.

The Commission had issued draft amendments to the earlier procedure on July 24, 2020, and invited suggestions from the stakeholders on the proposed changes.

As per the revised guidelines, the procedure will apply to central transmission utility (CTU), regional load dispatch centers (RLDCs), state load dispatch centers (SLDCs), state transmission utility, concerned distribution companies (DISCOMs), and implementing agencies.

Applicants whose generation capacity is already connected to the grid (ISTS or intrastate transmission system) or for which connectivity is already granted cannot apply for additional connectivity for the same generation capacity.A new application for additional generation capacity should be submitted.

Applicants who have been granted connectivity to ISTS for the generation projects based on a particular renewable energy source may, for the same generation capacity, change to another renewable source after intimating the CTU.

According to the revised procedure, in cases where subsidiary companies have been allowed to utilize the connectivity granted to the parent company, the connectivity grantee will be responsible for the generating station’s operational and commercial obligations.

The CTU will grant Stage-I connectivity within 60 days of the month’s last date in which the application was submitted. If capacity at the location where Stage-I connectivity has been granted becomes unavailable at a later stage, an alternative location will be allocated at the time of grant of Stage-II connectivity.

Stage II connectivity will be granted to an entity that has been issued the Letter of Award (LOA) or has entered into a power purchase agreement (PPA) with a renewable energy implementing agency or a distribution licensee consequent to tariff-based competitive bidding.

The Commission also said that renewable hybrid generating projects, including round-the-clock hybrid projects, will be eligible for separate stage-II connectivity for each location based on the same PPA.

After grant of Stage-II connectivity, the grantees must achieve the following:

  • Ownership or lease rights or land use rights of the land
  • Financial closure with sanction letter from a financial institution
  • Proof of release of funds supported by auditor’s certificate

Stage-II Connectivity grantees will be required to complete the dedicated transmission lines and generator pooling sub-stations on or before:

  • The project’s scheduled commercial operation date or as extended or delayed commissioning permitted by the implementing agency or the distribution licensee
  • Six months after the scheduled commercial operation date as intimated at the time of applying for the stage II connectivity

If the grantee fails to complete the dedicated transmission lines or generator pooling stations within the timeline stipulated, Stage-II connectivity will be revoked.

As per the revised regulations, the generator pooling station’s planned capacity should be less than the dedicated transmission line’s capacity required to be provided as per the grant of connectivity. The minimum aggregate evacuation capacity of the generator pooling station should not be less than 100 MVA.

In case the CTU finds that the dedicated transmission infrastructure is under-utilized, it may seek an explanation from the Stage-II connectivity grantee. If the CTU believes that the spare capacity is not being used without reasonable justification, it will result in denial of opportunity to other renewable energy generating stations. In that case, the matter should be brought to the notice of the Commission.

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Availability of power transmission infrastructure synchronized with the commissioning of projects is crucial but challenging for renewables. An added challenge with ISTS projects is the deadline on the waiver of charges and losses. Mercom has reported on this issue and will also be discussing this in detail with the relevant government officials at the Mercom Solar Summit to be held on April 8-9, 2021. The Summit has interesting topics on the agenda and you can register here.