Govt extends waiver of ISTS charges for solar, wind projects by 6 months

• The ISTS charge waiver will be effective for 25 years from the date of commissioning of the power plants

• The waiver can be availed by solar, wind, and hybrid projects with or without storage

New Delhi: The Ministry of Power has waived off the Interstate Transmission System (ISTS) charges and losses on transmission of electricity produced from all solar and wind projects commissioned before June 30, 2023, the ministry said in an official notification. The ISTS charge waiver will be effective for 25 years from the date of commissioning of the power plants and will be applicable to solar, wind, and hybrid projects with or without storage. "In supersession of Ministry of Power's earlier order No 23/12/2016-R&R dated 13.2.2018 and Order No. 23/12/2016-R&R dated 6th November, 2019 it has been decided that no inter-state transmission charges and losses will be levied on transmission of the electricity generated from following power plants for a period of 25 years from the date of commissioning of the power plants," the notification said.

Criteria for availing ISTS charge waiver

The Centre has also prescribed the criteria for the waiver of ISTS charges and loss on transmission and only those plants that are able to meet it can avail the waiver. According to the notification, power plants using solar and wind sources of energy and commissioned till June 30, 2023 for sale to entities having a Renewable Purchase Obligation (RPO), irrespective of whether this power is within RPO or not, provided that in case of distribution licensees, the power has been procured competitively under the guidelines issued by the Central Government, will be eligible for the waiver.

Solar PV power plants commissioned under "MNRE's Central Public Sector Undertaking (CPSU) Scheme Phase-II (Government Producer Scheme) dated 5.3.2019" will also be able seek a waiver. And Solar PV power plants commissioned under Solar Energy Corporation of India (SECI) tender for manufacturing linked capacity scheme (RFS No SECI/C&P/RfS/2GW Manufacturing/P3/R1/062019 dated 25.06.2019) for sale to entities having RPO, irrespective of whether this power is within RPO or not, will also be eligible.

The backdrop

In June, Power Minister RK Singh had said that the government was considering extending the waiver of ISTS charges for RE power projects by at least six months, as was reported by PSU Watch. The National Solar Energy Federation of India (NSEFI) had also asked the Centre to extend the waiver. The waiver has been offered in order to give a push to RE power generation in India and reach the target of having 175 GW of installed capacity by December 2022.

In November 2019, the Ministry of Power had announced that ISTS charges and losses on the transmission of electricity generated from solar and wind projects would be waived off for plants commissioned before December 31, 2022.

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