Regulator Allows Paid Extensions To Renewable Grid Access
POWER & RENEWABLE ENERGY

Regulator Allows Paid Extensions To Renewable Grid Access

The Central Electricity Regulatory Commission has introduced a framework allowing renewable developers extra time to retain inter-state transmission connectivity in exchange for escalating charges. Projects may seek up to 12 months of paid extension through Milestone Extension Charges to avoid derailing substantially advanced works. The measure aims to balance scarce connectivity with demonstrated project progress.

The approach replaces the prior General Network Access regime under which missed deadlines for land, financial closure or commercial operation could prompt revoked connectivity and encashed bank guarantees. The regulator received requests from developers facing enforcement and determined that graded compensation should be allowed irrespective of delay reasons. It said entities holding connectivity can block access for others and therefore additional time with payment is warranted.

For commissioning, the Milestone Extension Charge will start at Rs 3,000 per Megawatt (MW) per day for the first six months, rise to Rs 3,300-3,900 in months seven to nine and double to Rs 6,000 per MW per day in months 10-12. The extension cannot exceed 12 months and if full or part capacity still fails to achieve commercial operation, connectivity will be revoked. The regulator has also opened paid windows for earlier milestones.

Developers may seek up to three additional months for land compliance, with charges rising from Rs 1,000 per MW per day to Rs 1,200 per MW per day. Financial closure extensions run up to six months with charges starting at Rs 1,000 per MW per day and rising to Rs 1,300 in the sixth month. Relief is limited to projects that demonstrate tangible progress and meet eligibility criteria.

The criteria require documents for at least 20 per cent of required land for land and financial closure extensions. Commissioning extensions require 75 per cent land under the land or land-BG route and 50 per cent under the LoA/PPA route, with contracts for equipment and civil and electrical works. The regulator finalised the mechanism after consulting stakeholders, and industry participants said the change should reduce execution risk.

The Central Electricity Regulatory Commission has introduced a framework allowing renewable developers extra time to retain inter-state transmission connectivity in exchange for escalating charges. Projects may seek up to 12 months of paid extension through Milestone Extension Charges to avoid derailing substantially advanced works. The measure aims to balance scarce connectivity with demonstrated project progress. The approach replaces the prior General Network Access regime under which missed deadlines for land, financial closure or commercial operation could prompt revoked connectivity and encashed bank guarantees. The regulator received requests from developers facing enforcement and determined that graded compensation should be allowed irrespective of delay reasons. It said entities holding connectivity can block access for others and therefore additional time with payment is warranted. For commissioning, the Milestone Extension Charge will start at Rs 3,000 per Megawatt (MW) per day for the first six months, rise to Rs 3,300-3,900 in months seven to nine and double to Rs 6,000 per MW per day in months 10-12. The extension cannot exceed 12 months and if full or part capacity still fails to achieve commercial operation, connectivity will be revoked. The regulator has also opened paid windows for earlier milestones. Developers may seek up to three additional months for land compliance, with charges rising from Rs 1,000 per MW per day to Rs 1,200 per MW per day. Financial closure extensions run up to six months with charges starting at Rs 1,000 per MW per day and rising to Rs 1,300 in the sixth month. Relief is limited to projects that demonstrate tangible progress and meet eligibility criteria. The criteria require documents for at least 20 per cent of required land for land and financial closure extensions. Commissioning extensions require 75 per cent land under the land or land-BG route and 50 per cent under the LoA/PPA route, with contracts for equipment and civil and electrical works. The regulator finalised the mechanism after consulting stakeholders, and industry participants said the change should reduce execution risk.

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