INDIA Trends and Developments Contributed by: Poonam Verma Sengupta, Aditya Gupta, Sakshi Kapoor and Rajesh Jha, JSA
ISTS corresponding to their connectivity quantum during notified solar hours. In the case of RHGSs, injection scheduling rights are granted into the ISTS during non-solar hours cor- responding to the capacity based on sources other than solar, subject to the connectivity quantum. Wind-based REGSs (with or without Energy Stor- age Systems (ESSs)) and standalone ESSs may seek non-solar hour access where at least 50 MW of trans- mission capacity is available during non-solar hours. The framework recognises that transmission infra- structure connected to solar projects may remain underutilised outside solar generation periods. By enabling multiple resources to utilise the same trans- mission infrastructure at different times of the day, the amendments seek to improve utilisation of the ISTS and facilitate greater deployment of hybrid and stor- age-based projects. Bridging the gap between connectivity and project delivery While the GNA framework has expanded access to transmission infrastructure, it has also exposed a practical challenge. Connectivity allocation does not always translate into project implementation. Under the GNA framework, connectivity may be obtained through multiple routes. These include: (i) the Land Route – where land availability is demonstrated upfront; (ii) the Land Bank Guarantee Route – where the developer furnishes a land bank guarantee and subsequently achieves the prescribed land-related milestones; and (iii) the LoA Route – where connec- tivity is granted on the basis of a Letter of Award (LoA) issued by a Renewable Energy Implementing Agency (REIA). While the LoA Route facilitated early allocation of connectivity, it also exposed a significant challenge. A substantial number of projects secured connectivity based on LoAs. However, the corresponding Power Purchase Agreements (PPAs) and Power Sale Agree- ments (PSAs) did not materialise. As a result, con- nectivity remained tied to projects that were unable to progress, even as demand for connectivity continued to increase.
Recognising the scale of the issue, the Ministry of New and Renewable Energy (MNRE), in its Office Memo- randum dated 26 May 2026, proposed a one-time relief package for approximately 44.8 GW of renew- able energy projects affected by unsigned PPAs and PSAs. The proposal adopts both demand-side and supply- side measures. On the demand side, MNRE proposed measures to incentivise procurement of power by distribution licensees from affected projects. These include extension of ISTS charge waivers, integration of Battery Energy Storage Systems (BESSs), migration to State Transmission Utility connectivity in specified circumstances, deemed Renewable Purchase Obliga- tion and Renewable Consumption Obligation (RCO) compliance in certain cases, and measures aimed at expediting tariff adoption and procurement processes. On the supply side, MNRE proposed three options for developers holding LoA-based connectivity: • Developers may exit the LoA Route without surren- dering connectivity, subject to fulfilment of pre- scribed conditions. • Developers may substitute an existing LoA with a project backed by a secured PPA and continue to utilise the connectivity. • Developers may opt for a complete exit by surren- dering connectivity and cancelling the LoA, with a refund of the applicable connectivity bank guaran- tees. These measures seek to provide flexibility to develop- ers while ensuring that connectivity remains available for projects capable of timely implementation. In parallel, CERC had already initiated suo motu pro- ceedings to address connectivity granted on the basis of LoAs that did not translate into executed PPAs and PSAs. Through its draft Order dated 6 May 2026 in Petition No. 11/SM/2026, CERC has proposed a one- time framework for treatment of such connectivity (on the supply side) including options relating to retention, substitution and surrender of connectivity. The MNRE proposal and CERC draft framework broadly adopt a similar approach to the treatment of LoA-based con- nectivity under the GNA framework.
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