CERC Proposes Stricter Grid Deviation Rules for Renewable Projects

19 Sep 2025 CW Team

The Central Electricity Regulatory Commission (CERC) has proposed amendments to the deviation settlement mechanism (DSM) for wind, solar, and hybrid projects, effective April 2026, in a move aimed at strengthening grid stability.

The regulator has suggested shifting the DSM calculation from available capacity to scheduled generation. From 2026, deviations will be computed using the formula:

Dws% = 100 x [(Actual Injection – Scheduled Generation) / (X% of Available Capacity + (100-X)% of Scheduled Generation)]

CERC has proposed a phased reduction of the ‘x’ value from 100% in 2026 to 0% by 2031, which would increase deviation charges for renewable energy generators over time.

The DSM tolerance bands will also be narrowed—from ±15% to ±10% for wind projects, and from ±10% to ±5% for solar projects.

A Grid-India study across 16 renewable projects showed the tightening could significantly increase deviation incidents. Solar projects may face 3.5–11.1% revenue losses, hybrid projects 2.4–11.8%, while wind projects could see losses as high as 48.2% due to higher variability.

To mitigate such impacts, CERC suggested better forecasting, aggregation of projects, and operational discipline. Additionally, wind and solar projects will not be compensated for over-injections when grid frequency exceeds 50.05 Hz.

The Commission has invited stakeholder comments on the proposal until October 5, 2025.

News source: Mercom India

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