CERC proposes stricter ESS connectivity and GNA bank guarantee norms
The Central Electricity Regulatory Commission (CERC) has released the draft Central Electricity Regulatory Commission (Connectivity and General Network Access to the inter-State Transmission System) (Fourth Amendment) Regulations, 2026, proposing major changes to connectivity and General Network Access (GNA) rules. The draft was issued on May 20, 2026, and stakeholders may submit comments, suggestions, and objections till June 22, 2026.
The proposed amendments cover Energy Storage Systems (ESS), bank guarantees, source change timelines, financial closure requirements, transfer of GNA, and connectivity provisions for renewable energy projects.
ESS focus
The draft introduces minimum discharge requirements for ESS projects. Under the proposed amendment, ESS projects seeking connectivity will need a minimum discharge capacity equal to twice the connectivity quantum in MWhr. The requirement has been inserted across Regulations 4.1, 5.2, and 5.4.
CERC has also proposed that ESS projects excluding pumped storage plants furnish bank guarantees of Rs 5 lakh per MW. In addition, ESS projects seeking additional capacity may install Renewable Energy Generating Stations exclusively for charging purposes without requiring land documents or financial closure documents for such renewable capacity.
A new Regulation 4.7 allows generating stations, including renewable energy and storage projects, to seek only non-solar hour access at locations not covered under the existing solar hour access provisions.
Connectivity changes
The amendment introduces a new definition for LAND BG, referring to bank guarantees furnished under specified land document clauses of Regulation 5.8.
A new Regulation 3.10 allows entities to withdraw full connectivity quantum and obtain return of all bank guarantees if the gap between the likely start date in the in-principle grant and the start date in the final grant is two years or more. The request must be made within thirty days from the final grant of connectivity.
The timeline for source change applications has been reduced from eighteen months to six months before the firm start date of connectivity. A second source change will also be permitted with a fee of Rs 50,000 per MW corresponding to the extent of source change.
The draft further clarifies provisions for multi-location renewable energy projects covered under a single letter of award or power purchase agreement. Detailed eligibility conditions and illustrations have been included for projects spread across multiple states and technologies.
Financial closure and GNA transfer
Financial closure timelines under Regulation 11A have been revised significantly. Renewable Energy Generating Stations excluding hydro projects, ESS excluding pumped storage plants, and Renewable Power Park Developers will now need to furnish financial closure documents within fifteen days from the effective date of GNA instead of the earlier timeline linked to final connectivity grant.
The amendment also allows entities that initially applied under land or land bank guarantee provisions to convert their connectivity category to a power purchase agreement-based category after signing a power purchase agreement.
A new Regulation 23A permits transfer of GNA where identified load connected at a single drawal point is sold to another entity. The GNA may be transferred to the new owner after the GNA becomes effective and all dues are cleared.
The draft also proposes changes to bank guarantee return mechanisms. Instead of staggered return over five years, bank guarantees would now be returned within one week after completion of one year from declaration of commercial operation of the corresponding capacity.
Transition provisions have also been included for projects that have already completed one year from commercial operation before the amendment comes into force. In such cases, the Nodal Agency would return the subsisting Conn-BG2 and Conn-BG3 within one month, subject to clearance of transmission charge dues.
CERC has directed the Nodal Agency to revise the Detailed Procedure within sixty days from notification of the amended regulations after stakeholder consultation.
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