The Ministry of Power (MoP) has waived interstate transmission system (ISTS) charges and losses on all solar and wind projects commissioned before June 30, 2023.

This would apply to solar, wind, and hybrid projects with or without storage. The ISTS charges would be waived for 25 years from their date of commissioning for the transmission as well as sale to entities with renewable purchase obligations (RPO).

The waiver would apply to solar projects commissioned under the second phase of the Ministry of New and Renewable Energy’s (MNRE) Central Public Sector Undertaking (CPSU) Program and also for solar projects commissioned under SECI’s manufacturing-linked solar tender which was reissued in June 2019.

Background: 

In November 2019, the Ministry of Power had announced that the ISTS charges and losses on the transmission of electricity generated from solar and wind projects would be waived off as long as they are commissioned before December 31, 2022. This deadline was revised from March 31, 2022, set previously.

In June, Union Power Minister, R.K. Singh, suggested the government was likely to consider extending the interstate transmission system charges for renewable projects by at least six months.

The National Solar Energy Federation of India (NSEFI) had also asked the Ministry of New and Renewable Energy to extend the waiver of ISTS charges and losses for renewable energy projects.

The objective behind the waiver of inter-state transmission charges and losses was to encourage wind and solar energy capacity in the country by reducing the cost of generation, to achieve the country’s target of achieving 175 GW of renewable energy capacity by December 31, 2022.

Mercom recently spoke to industry stakeholders who unanimously agreed that the industry needs a longer deadline extension for the ISTS charges and losses waiver to give them some breathing room to get their projects back on track following the havoc caused by the pandemic.