India Extends ISTS Charges Waive Off Period

• India has extended the timeline for project commissioning date for solar and wind power projects that wish to seek ISTS charges and losses waive off
• From the previous commissioning deadline of March 31, 2022, it has now been extended to projects that start commercial operations by December 31, 2022
• Such projects will be exempt from paying such charges for 25 years as as long as these fulfil the other conditions of having been awarded through competitive procurement process and carry a PPA with distribution companies

The Indian Ministry of Power has extended the deadline to waive interstate transmission (ISTS) charges and losses on transmission for electricity generated by solar and wind power projects to December 31, 2022. Previously, the deadline included only solar power projects commissioned by December 31, 2019, which was later extended till March 31, 2022 (see No ISTS Charges For Indian PV Projects).

The announcement comes soon after the Ministry of New and Renewable Energy (MNRE), also headed by tPower Ministry head RK Singh, issued a clarification regarding the exact date to reach India's 175 GW renewable energy target, fixing it now at December 31, 2022, which previously was considered to be March 31, 2022 (see India Clarifies 175 GW RE Target Achievement Date).

As per the Power Ministry's order, the waiver will be applicable for a period of 25 years for such projects that achieve the desired commissioning date and those that have a power purchase agreement (PPA) with distribution companies to help meet the latter's renewable purchase obligations (RPO).

For solar and wind power projects to claim this waiver, these need to have been awarded through a competitive bidding process in accordance with the federal government's guidelines.

This extension is expected to help the Indian solar scene become more active once again as developers would be eyeing the new target date in order to avail the waiver while the next two years would see higher auction and project development activity.