CEA Proposes Key Changes In Draft Regulations For Connectivity

Changes to Electricity Rules

In a draft notification proposing specific changes through a second amendment to the to the Connectivity and General Network Access to the inter-State Transmission System) Regulations, 2022, the Central Electricity Authority has proposed some key changes. The first amendment was done back in 2023, while the regulations were published in 2022.

Key proposals (amendments) include the definition of a Renewable Energy Implementing Agency specifically, as any agency designated by the central or state governments to procure renewable power and distribute it to one or more discoms, or any other entity.

Changes have also been proposed in the clauses around bank guarantees for projects, with the new proposal for Rs 10 Lakh per MW for projects upto 1000 MW,  and Rs 1000 crores plus Rs 5 lacs per MW for projects over 1000 MW. These are in lieu of ownership to lease rights or land use rights for 50% of the land required for the capacity for which connectivity is sought.

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Applicants who are REGS other than Hydro power developers or ESS (excluding PSP) will need to submit proof of land acquisition with at least 10% of project cost through equity infusion, at least 12 months before scheduled commercial start of operations.

Financial closure in cases where final connectivity permission has been granted, will have to be achieved within 12 months of such date.

Connectivity issues have been a key cause for delays in renewable projects, with pressure increasingly on CUTIL to speed up the process While land acquisition is a key factor in such delays, it is a fact that delays at the generator end in terms of financial closure or changes in scheduled commercial operations date have also led to many issues between them and the transmission utilities.

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