India confirms waiving of inter-state transmission charges for wind and solar

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on reddit
Reddit
Share on email
Email
FlickrL Tapas Ganesh

India’s Ministry of Power has confirmed previously announced plans to waiver inter-state transmission charges and losses for both wind and solar projects won through competitive bidding.

The move, suggested 12 months ago, is aimed at maintinaing the progress of renewables as local grids become constrained by the increasing penetration of alternative sources of energy.

The ministry said it is waiving the charges and losses for solar projects commissioned by 30 June 2017 and for wind projects commissioned by 31 March 2019. Wind projects have yet to be awarded through competitive bidding, hence the later deadline.

Consultancy firm Mercom Capital Group said projects selling their power through the inter-state transmission system (ISTS) would benefit. Under the current trajectory, the spread of renewable power across India is uneven leading to the need for some developers in highly concentrated areas of renewables to sell power between states.

Ministry of New and Renewable Energy (MNRE) sources told Mercom that waiving the charges would reduce solar power tariffs by roughly 10% in various locations. It should also help to hasten the building of the major Green Energy Corridors plan, which will help transmission of renewables across the whole country.

Raj Prabhu, Mercom chief executive, said: “This policy is good news for large-scale solar in the short-term. The Ministry of Power should take the next step and extend the deadline by a few years to help solar projects get developed in resource rich areas and spread solar power consumption across the country. Low module prices along with the transmission waiver could help some of the low bid solar projects become workable if they are able to commission them by June of next year.”

The new policy affects power sold via the ISTS, but not power sold to local distribution companies (Discoms). Unfortunately, news of Discoms failing to prioritise solar and not purchasing solar power has surfaced of late, with energy minister Piyush Goyal even citing the issue last week. However, Mercom said that now projects have an option of selling power to the national grid without incurring transmission charges and losses.

From another perspective, buying renewable power through the ISTS will also help some states to achieve their Renewable Purchase Obligation (RPO).

Read Next

October 13, 2021
Reliance New Energy Solar (RNES) has invested US$29 million in German wafer technology company NexWafe’s Series C financing round as it looks to establish wafer production facilities in India.
October 11, 2021
A subsidiary of Indian conglomerate Reliance Industries has acquired solar module manufacturer REC Group and a 40% stake in EPC and O&M solutions provider Sterling and Wilson.
October 11, 2021
The Indian government is reportedly either considering a delay to its customs duty on imported solar products or allowing domestic projects to push back deadlines in light of uncertainty from Chinese suppliers, the country’s renewable energy minister, RK Singh, told the Economic Times.
October 6, 2021
Indian solar manufacturer Emmvee has signed a memorandum of understanding with the government of Karnataka to set up a 3GW cell and module production plant in the state.
September 28, 2021
Indian solar manufacturer Premier Energies has secured an INR 2 billion (US$27 million) investment from private equity firm GEF Capital Partners to support its planned increases in cell and module production.
September 27, 2021
A new support scheme from India’s government to boost the domestic manufacture of PV modules has seen 18 bidders submit 54.8GW of applications, according to consultancy JMK Research & Analytics.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
October 19, 2021
BRISTOL, UK
Upcoming Webinars
November 10, 2021
8am (PST) | 5pm (CET)
Solar Media Events
December 1, 2021