ISTS waiver extended for RE projects delayed by transmission gaps

The Ministry of Power issued an Office Memorandum on April 16, 2026, clarifying the conditions under which renewable energy (RE) projects can continue to avail the graded waiver of Inter-State Transmission System (ISTS) charges where commissioning has been delayed due to non-readiness of transmission infrastructure.

The memorandum follows representations from RE developers seeking clarity on whether projects with a firm start date of connectivity between July 1, 2025 and June 30, 2028 would retain the waiver benefit if commissioning is delayed due to transmission systems not being ready. The ministry has addressed this by allowing such projects to remain eligible for the graded waiver, subject to defined conditions.

It noted that ISTS charge liability rests with procurers rather than RE developers under existing regulatory provisions. However, delays in transmission infrastructure can lead to disputes under power purchase agreements (PPAs) between developers and procurers. To address this, the ministry stated that projects may qualify for a graded waiver of 75%, 50%, or 25%, as applicable, if three conditions are met: a firm PPA in place as of March 31, 2026; a firm start date of connectivity within the July 1, 2025 to June 30, 2028 period; and commercial operation achieved before, or within the specified time limit from, the commercial operation date of the relevant transmission system.

Projects with a firm start date of connectivity on or before June 30, 2025 may be eligible for a 100% waiver, subject to the same conditions.

The Ministry of Power has directed the Central Electricity Regulatory Commission (CERC) to frame suitable regulatory provisions to implement these benefits. 

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