India's electricity regulator has proposed bringing back transmission charge waivers for clean energy projects hit by infrastructure delays. This potential policy shift aims to support solar, wind, and hybrid projects that secured power contracts before the end of 2026. By addressing grid connectivity bottlenecks, the move seeks to help developers complete stalled projects and meet commissioning deadlines.
The Central Electricity Regulatory Commission (CERC) has introduced draft regulations that could revive transmission fee waivers for renewable energy projects. These charges, known as Interstate Transmission System (ISTS) charges, are often a significant cost for developers. If finalized, this proposal would provide relief to developers whose projects have been delayed specifically due to the unavailability of transmission infrastructure.
Impact on Renewable Energy Timelines
Many solar, wind, and hybrid renewable energy projects in India have faced significant execution risks due to delays in building necessary transmission lines. When transmission capacity is not ready on time, projects cannot evacuate the power they generate, leading to stalled operations and financial stress. By reinstating these waivers, the regulator is attempting to reduce the burden on project developers who are not responsible for the grid connectivity delays. This measure is intended to help developers bring their projects online faster without the added cost of transmission fees during the initial operational period.
Policy Shift and Eligibility
This proposal marks a notable adjustment in policy, as India had started phasing out these waivers for new solar, wind, and hybrid projects starting in July 2025. The new draft suggests that the regulator recognizes that transmission infrastructure has not kept pace with the rapid capacity addition in the renewable sector. To qualify for the relief, projects must have secured power sale contracts for at least seven years. Additionally, these contracts must have been signed on or before December 31, 2026.
Battery Storage Systems Inclusion
The scope of the proposed waiver is designed to include battery storage systems that are integrated with renewable energy plants. As India pushes for more reliable round-the-clock renewable power, energy storage has become a critical component. By extending the transmission fee benefit to power sourced from these integrated storage systems, the CERC aims to improve the financial viability of hybrid projects that combine generation with storage.
Investors and market observers will now track the official notification of these regulations. The key monitorable will be the feedback from industry stakeholders and the final timeline for implementation. Successful adoption of these waivers could potentially improve project internal rates of return and lower the cost of power for developers, helping to clear a backlog of stalled renewable capacity across the country.