Industry Flags Risks Of CERC Rule Linking Grid Access To PPAs

New Delhi, Jan 17 (KNN) India's renewable energy sector has voiced strong opposition to a regulatory proposal that could see developers forfeit interstate transmission system (ISTS) connectivity if long-term power purchase agreements are not executed within a prescribed period.

In submissions to the Central Electricity Regulatory Commission (CERC), industry associations argued that the proposed rules would unjustly penalise renewable energy projects delayed by factors outside developers control, especially procedural delays at state-owned distribution companies.

CERC Flags Idle Connectivity Capacity

The objections stem from a CERC paper issued in November, which flagged that over 45 GW of renewable capacity has grid connectivity based on letters of award but no PPAs, leading to blocked transmission bays. The paper suggested auctioning surrendered connectivity and treating grid access as lapsed if PPAs are not signed within 12 months.

Concerns Over Impact on Clean Energy Targets

Industry bodies cautioned that the measures could hurt India's clean energy goals of 500 GW of non-fossil capacity by 2030. They noted that while renewables have grown quickly, project delays and transmission bottlenecks persist, with the 495,000-circuit-km grid struggling to keep pace.

The National Solar Energy Federation of India opposed auctioning vacated grid connectivity at a premium, warning it would push up tariffs and favour large, cash-rich players. NSEFI said grid access should not become a tradable asset and attributed PPA delays mainly to slow tariff approvals by state discoms, not developer inaction.

Wind Sector Seeks More Realistic Timelines

Wind energy associations said the proposed timelines are unworkable for wind projects, citing long manufacturing and import cycles for turbines and key equipment. They opposed the 18-month completion deadline and urged CERC to allow a more realistic 24–30 month timeframe.

SECI warned that auctioning grid connectivity at a premium could push up future tariffs. It instead recommended reallocating connectivity based on project readiness, such as land acquisition, financial closure and equipment procurement, rather than highest bids.

Call for Coordinated Policy Action

Industry bodies urged CERC to address structural bottlenecks rather than penalising developers, calling for closer coordination with power and renewable energy ministries to ensure timely PPAs and smooth project execution.

(KNN Bureau)