CERC order highlights risks for renewable developers when PPAs and connectivity approvals are delayed
The Central Electricity Regulatory Commission (CERC) has granted Datta Power Infra Private Limited an additional 30 days to submit financial closure documents for its 162 MW wind-solar hybrid projects in Madhya Pradesh, while criticising Central Transmission Utility of India Limited (CTUIL) for delays in issuing the final grant of connectivity.
The dispute arose after Datta Power sought an extension of timelines for achieving financial closure and commencement of connectivity for projects awarded by SJVN Limited in 2024. The company argued that the absence of signed power purchase agreements (PPAs) had delayed project financing.
CTUIL had fixed December 30, 2025, as the deadline for achieving financial closure, based on the developer’s proposed commissioning date of June 30, 2026. Following non-compliance with the deadline, CTUIL revoked the connectivity on February 11, 2026, and initiated the encashment of bank guarantees amounting to approximately Rs 3.74 crore.
During the proceedings, CERC observed that Datta Power had submitted the required bank guarantees on July 31, 2025. Under the applicable regulations, CTUIL was expected to issue the final grant of connectivity within 15 days, or by August 15, 2025. However, the final grant was issued only on December 29, 2025, nearly four-and-a-half months later and just one day before the financial closure deadline.
The Commission noted that the delay could not be justified, particularly when the related transmission works had not commenced. In its order, CERC described CTUIL’s conduct as a “casual approach” and directed the utility to process all pending final grants of connectivity within 30 days and submit a compliance report.
While holding that CTUIL had acted in accordance with the regulations when it revoked the connectivity for failure to achieve financial closure, the Commission exercised its powers under the relaxation provisions and set aside the revocation letter. Datta Power has been granted 30 days from the date of the order to submit the required financial closure documents.
The order provides that if the documents are submitted after 30 days but within 60 days, the developer will be liable to pay a penalty equivalent to 5% of the bank guarantee amount. Failure to submit the documents within 90 days will result in automatic revocation of connectivity.
The case highlights the challenges faced by renewable energy developers in meeting connectivity milestones when project financing is delayed due to pending PPAs. The Commission’s observations also underscore the importance of timely processing of connectivity approvals by transmission authorities.
The featured photograph is for representation only.
