Off-shore wind energy projects, Complete waiver of ISTS charges for 25 years to projects commissioned before 31st Dec, 2032

Ministryof Power

The Government has made a significant decision to grant waivers of ISTS charges (Inter-State Transmission Charges) for Off-Shore Wind Projects, Green Hydrogen/Green Ammonia Projects, and Energy Storage System Projects. This decision aims to promote the development of offshore wind energy initiatives, encourage the expansion of Green Hydrogen/Green Ammonia Projects, and facilitate the offtake of renewable energy from Energy Storage System Projects.

For off-shore wind power projects commissioned on or before December 31, 2032, a complete waiver of ISTS charges has been granted for a period of 25 years from the date of commissioning. However, for projects commissioned from January 1, 2033, there will be graded ISTS charges applied. Previously, all wind energy projects were granted waivers until June 30, 2025. Now, offshore wind projects will be treated separately, with waivers granted until December 31, 2032, followed by graded transmission charges.

In addition, a complete waiver of ISTS charges for 25 years from the commissioning date has been provided for Green Hydrogen/Green Ammonia production units that use Renewable Energy, Pumped Storage System, Battery Storage Systems, or a hybrid combination of these technologies. This waiver is applicable to projects commissioned after March 8, 2019, and projects commissioned on or before December 31, 2030, will be eligible. For projects commissioned after December 31, 2030, graded transmission charges will be applicable.

To promote the development of Pumped Storage Plants (PSP), the eligibility criteria for complete waiver of ISTS charges have been linked to the date of project award rather than project commissioning. This applies when construction work is awarded on or before June 30, 2025.

Furthermore, the ISTS charges on drawl of energy from energy storage projects will now be available for each individual user of such projects, provided that at least 51% of the energy used for charging the storage system is renewable energy. This change is made considering that in the future, storage projects may be shared by multiple discoms/other users, and the 51% renewable energy criteria may be met individually even if not met collectively at the project level.

Lastly, if a project is eligible for the waiver of transmission charges based on its original Date of Commissioning (COD), the same benefit will continue to be available if the COD is extended by the competent authority. This is to provide confidence to investors who make investment decisions based on the prevailing circumstances, but due to unforeseen reasons, their COD may extend beyond the applicable date for transmission charge waiver.

These measures are aimed at promoting and facilitating the development of renewable energy projects, offshore wind energy initiatives, green hydrogen/green ammonia production, and energy storage systems, thus contributing to the country’s sustainable energy goals.