The Central Electricity Regulatory Commission (CERC) has held that renewable energy generators are liable to pay bilateral transmission charges for the associated transmission system until their projects achieve commercial operation. It rejected their request to quash the invoices issued by the Central Transmission Utility of India (CTUIL).

It directed CTUIL to revise bills for periods after the commercial operation date of each project capacity, with charges thereafter to be recovered under the general transmission pool.

Background

The case arose from petitions filed by ReNew group entities, Adani Renewable Energy entities, and Altra Xergi Power challenging transmission charge invoices raised by CTUIL for the Powergrid Ramgarh Transmission (PRTL) system.

The projects were granted long-term access to the interstate transmission system and connected through the Fatehgarh III pooling station. The Commission treated the PRTL as the transmission system required for immediate power evacuation.

The petitioners argued that transmission charges could not be levied before the operationalization of general network access. They submitted that liability should arise only after general network access became effective and after the entire transmission system identified under their long-term access grants was commissioned.

They also relied on extensions granted under power purchase agreements, including those issued by the Solar Energy Corporation of India, to argue that their scheduled commercial operation dates had been shifted and that charges should not apply during the extended timelines.

The petitioners argued that renewable energy projects are entitled to a waiver of interstate transmission charges and that this benefit should apply during the disputed period.

CTUIL opposed the petitions, stating that the PRTL achieved commercial operation on December 24, 2023, and was available for power evacuation. It argued that under Regulation 13(3) of the Sharing Regulations, generators must pay transmission charges when the associated transmission system is ready but generation is delayed.

Commission’s Analysis

The Commission examined whether the petitioners were liable to pay transmission charges before their projects achieved commercial operation and before general network access became effective.

It held that the PRTL qualifies as the associated transmission system because it enables the immediate evacuation of power from the pooling station to the grid. It clarified that the associated transmission system does not include the entire network identified under long-term access, but only the system required for immediate evacuation.

The Commission relied on Regulation 13(3) of the Sharing Regulations, which requires generators to pay transmission charges when the associated transmission system has achieved commercial operation and the generating station is delayed. It clarified that this obligation is not linked to the effective date of general network access.

The central regulator rejected the argument that the entire transmission system under long-term access must be commissioned before charges can be levied. It held that the availability of the associated transmission system is sufficient to trigger liability.

It also rejected reliance on extensions granted under power purchase agreements. It held that transmission arrangements operate independently of power supply contracts and that extensions in scheduled commercial operation dates do not affect obligations under transmission regulations.

On the renewable energy waiver, the Commission clarified that exemption from interstate transmission charges applies only after a project achieves commercial operation. Where the transmission system is ready, but the generator is delayed, charges are payable under the regulations.

The Commission held that once a generating unit or part capacity achieves commercial operation, it should no longer bear bilateral transmission charges for that capacity. Such capacity must be transferred to the general transmission-sharing mechanism, and invoices must be revised accordingly.

For ReNew’s projects, the Commission directed revision of invoices based on staggered commercial operation dates across capacities, including commissioning between February and June 2024. Adani’s project, which has not yet achieved commercial operation and is expected to be commissioned between February and March 2026, will continue to incur transmission charges until commissioning. The Commission noted that Altra Xergi Power has already paid the applicable bilateral transmission charges.

The Commission directed CTUIL to verify commercial operation dates and revise invoices for post-commissioning periods. It also directed the petitioners to pay the outstanding transmission charges, after adjustment, within the specified timeline, thereby upholding the validity of the invoices subject to revision.

The Ministry of Power recently announced that solar and wind projects with a firm start date of connectivity between July 1, 2025, and June 30, 2028, may be eligible for a graded interstate transmission system charges waiver extension if commissioning is delayed due to transmission system unavailability.

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