Govt extends transmission charge waiver for solar projects facing delays

By: |
January 20, 2021 5:00 AM

The move is seen to benefit about 6,000 MW of solar projects that are currently facing delays in construction due to issues such as land availability, inadequate transmission capacity and supply disruptions due to Covid.

At present, as much as 13,816 MW solar plants are being constructed through auctions conducted by the Centre.At present, as much as 13,816 MW solar plants are being constructed through auctions conducted by the Centre.

In a bid to provide relief to renewable power producers facing delays in project commissioning due to reasons beyond their control, the government has allowed solar and wind-based generation projects to avail transmission charge waivers even if they fail to set up their plants within June 30, 2023 — the deadline set for projects to receive the benefit.

The move is seen to benefit about 6,000 MW of solar projects that are currently facing delays in construction due to issues such as land availability, inadequate transmission capacity and supply disruptions due to Covid. At present, as much as 13,816 MW solar plants are being constructed through auctions conducted by the Centre.

Through its latest order issued on Tuesday, the Union power ministry said that “any renewable power project which is eligible for waiver of inter-state transmission charges and is having its scheduled date of commissioning on or before June 30, 2023, is granted extension of time from the commissioning on account of force majeure or for delay on the part of the transmission provider in providing the transmission even after having taken the requisite steps in time; or on account of delays on the part of any government agency, and the power plant is commissioned before the extended date; it will get benefit of waiver of inter-state transmission charges on the transmission of electricity generated by the power plant”.

Transmission charges add about Rs 0.20–0.50 per unit to every unit of thermal power. The policy of waiving this charge for renewables was designed to make solar and wind more attractive for cash-strapped discoms. As FE recently reported, solar projects with combined capacity of 18,000 MW are facing grim prospects with the state-run discoms developing cold feet on buying power from them, as tariffs discovered under subsequent auctions have fallen to the record low of Rs 1.99/unit, buoyed by lower interest rates, falling solar panel prices, improved technology and assured purchase of power.

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