The Central Electricity Regulatory Commission has ordered renewable energy firms to surrender unused transmission rights or provide higher bank guarantees if they fail to generate electricity, aiming to free up grid capacity for projects that are producing power. The order, dated July 11, also allows firms to transfer transmission rights to a group utility that is generating but lacks grid connectivity. The regulator said this seeks to address bottlenecks created by non-operational allocations.

A substantial amount of renewable capacity was awarded between 2019 and 2025 but much of that capacity does not yet have customers, the CERC said, and transmission access is being occupied by projects that may not proceed. The regulator estimated that about 15.7 GW of connectivity could be released for other developers. Under the order, surrendered connectivity will first be offered to existing applicants within the same substation cluster and any remaining capacity will be auctioned.

Power producers retain the option to hold transmission connectivity if they provide additional bank guarantees, while developing projects independently, the CERC noted. Firms may also transfer transmission rights within a corporate group to units that are generating but currently lack grid connection. The measure is intended to accelerate the use of existing network capacity and to prioritise projects that are delivering electricity to customers rather than those yet to reach commissioning.

The regulator's directive aligns with efforts to improve utilisation of the transmission network and to reduce idle reservations that constrain new entrants. Market participants will now face a choice between relinquishing unused rights, increasing financial assurances, or reallocating access within their group, which could alter project timelines and financing plans. Connectivity that is relinquished or auctioned is expected to become available for projects ready to connect and supply power to the grid.