CERC Draft Sets 2032 Deadline For 100% ISTS Waiver On Offshore Wind

The Central Electricity Regulatory Commission (CERC) has issued the Fourth Amendment to the Sharing of Inter-State Transmission Charges and Losses Regulations, 2025, introducing key updates to Regulations 12 and 13 of the principal regulations. The amendment waived interstate transmission charges (ISTS) to the Wind, Solar, Energy Storage (ESS), and Pumped Storage Project (PSP) projects.

This aligns with CERC’s earlier policy outlined in the fourth draft, which proposed waiving ISTS charges for offshore wind projects commissioned up to 2032, pumped storage projects (PSPs) with at least 70% renewable energy-based charging, and BESS projects connected to the ISTS network that supply renewable energy. The draft also extended the waiver to green hydrogen or ammonia production.

Amendment to Regulation 12: Transmission Deviation For Dual Connectivity

Under the revised order, CERC brought an amendment to Regulation 12, CERC by adding two new provisos under sub-clause (a), clause (1). The regulation states:

“Provided also that for a generating station having dual connectivity to both interstate transmission system and intrastate transmission system, the transmission deviation can be computed as net metered ex-bus injection.”

“Provided also that the details of access with the State Transmission Utility (STU) can be shared by STU with the National Load Despatch Centre (NLDC) and the Central Transmission Utility (CTU).”

It means that if a power plant is connected to both the interstate transmission system (ISTS) and the intrastate transmission system (InSTS) (this is called dual connectivity). Additionally, any deviation in electricity transmission will be measured based on the net amount of electricity injected at the ex-bus level (i.e., after internal use/losses and right before it enters the transmission network). This would help to avoid double-counting or confusion by ensuring only the final net output going into the grid is used for deviation calculations.

Amendment to Regulation 13: Offshore wind, ESS, and waiver eligibility

CERC in the revised draft amended Regulation 13(2) included offshore wind projects. In the draft, CERC further clarified that Renewable Energy Generating Stations (REGS) or Renewable Hybrid Generating Stations (RHGS) based on wind, solar, or a combination of both are now eligible for waiver of interstate transmission charges under the latest draft amendment. Additionally, Energy Storage Systems (ESS) are also now included under the waiver framework, subject to conditions specified in sub-clause (c).

Hydro PSP ESS:

Whereas, for Hydro-based Pumped Storage Projects (PSPs), for which construction work is awarded on or before 30 June 2028, are also now eligible for a 25-year waiver on transmission charges from the Commercial Operation Date (COD), under the revised draft. The regulation also stated, “When such Hydro PSP is supplying power to a drawee DIC, 100% of the drawal schedule for the drawee DIC from such Hydro PSP can be considered for the calculation of waiver.”

Force Majeure-based COD Extension And Waiver Retention

Any REGS (Renewable Energy Generating Station), RHGS (Renewable Hybrid Generating Station) based on wind and/or solar, or Battery ESS scheduled to achieve COD on or before June 30, 2025, under the revised draft Regulation 13(2), will remain eligible for a waiver if delayed due to a Force Majeure event — including non-availability of transmission infrastructure or reasons not attributable to the project — provided COD is achieved within the extended timeline. Moreover, under the latest revised draft, the extension can not exceed six months at a time, and can be granted not more than twice, if it goes beyond 30 June 2025.

As per the draft, such extension would be granted by a Renewable Energy Implementing Agency (REIA), a distribution licensee, or an authorized agency on behalf of a distribution licensee or MNRE, where the PPA is executed under tariff-based bidding (Section 63 of the Act). To seek such extension, the concerned generation project or ESS can apply to the Committee as notified through a separate Order by the Commission.

Verification of renewable sourcing for ESS waiver

To calculate monthly transmission charges by NLDC, ESS projects must meet the 51% renewable sourcing requirement (as per sub-clauses (c) and (f)), the draft clarified. The energy used for pumping water or charging batteries must be sourced from REGS or RHGS based on wind or solar. It must:

• Entities may self-declare their compliance initially.

• After the financial year, NLDC will verify the 51% compliance.

• If unmet, revised bills will be issued without the waiver.

Co-located ESS Can Get 10% Cap on Annual Energy Requirement 

CERC draft regulation notified details on the BESS side, it mentioned, “Battery ESS are required to charge from REGS connected at the same substation. However, it may draw from the grid during contingencies, subject to the Grid Code and GNA Regulations. They would also be eligible for a cap of 10% of the annual energy requirement from the grid for charging.”

Additionally, for co-located REGS and ESS, the CERC draft added that projects that are solely charging the ESS and without additional ISTS connectivity quantum, will also now qualify for the waiver under the latest draft regulations.”