Inter-state transmission charges for wind, solar projects waived

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The Centre has waived inter-state transmission charges and losses on transmission of electricity generated from solar and wind projects by revising the National Tariff Policy.

The government issued a notification in this regard on September 30.

The waiver will be applicable for wind power projects commissioned till March 31, 2019, and solar power projects commissioned till March 31, 2017, according to the CERC (Sharing of inter-state transmission charges and losses) (third amendment) Regulations, 2015.

The waiver will be available for 25 years from the date of commissioning of both wind and solar projects. However, the power ministry has said only wind and solar projects awarded through competitive bidding will be entitled for the waiver.

Further, the waiver will be available for wind projects entering into power purchase agreements for sale of electricity to distribution companies for compliance with their renewable purchase obligation (RPO).

“The waiver is well meant but too constraining to deliver the intended policy impact. Generally, inter-state projects entail larger capacity and to properly prepare a project for competitive bidding requires time. Ideally, a policy of this nature should offer a time-frame of two or three years to attract credible investors, rather than mere months,'' Kameswara Rao, partner (grid), PwC, told Business Standard.

He said renewable energy could deliver much more with policy consistency. In some states, the regulators and courts have interpreted the RPO to apply on a broader range of designated consumers, such as open access users, rather than just the distribution companies. The waiver should be extended to include such open access consumers too, he added.

Kuldeep Jain, managing director, CleanMax Solar, said the concept was sound and it would boost renewables in the energy mix.

“'However, a few additional steps need to be taken. These include providing solar developers time till 2019 and extending the benefits to captive and group captive projects. This will enable large multi-state industrial consumers to set up central captive generation projects,”he added.

WAIVING GOODBYE
  • The government issued a notification in this regard on September 30

     
  • The waiver will be applicable for wind power projects commissioned till March 31, 2019, and solar power projects commissioned till March 31, 2017

     
  • The waiver will be available for 25 years from the date of commissioning of both wind and solar projects

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