The Ministry of New and Renewable Energy (MNRE) has prepared a draft one-time relief package for around 44.8 GW of stranded renewable energy projects. The projects have received letters of award (LoAs) but are still awaiting power purchase agreements (PPAs) and power sale agreements (PSAs). The proposed package aims to help revive these stranded projects and facilitate the signing of pending agreements through a mix of demand-side incentives and supply-side resolution measures.
Under the demand-side category, the MNRE has proposed measures to make PSA execution more attractive for distribution companies and end procurers. These include a one-time 100 per cent waiver of interstate transmission system charges for eligible projects, provision of two hours of battery energy storage system support with standalone solar projects. Moreover, projects tendered under the ISTS-connected framework may be allowed to connect to the state transmission utility network if the power is supplied to the same state. The other measures include granting deemed renewable purchase obligation and renewable consumption obligation compliance if the discoms sign PSAs within 3 months of the release of the official relief package; and deemed tariff adoption if State Electricity Regulatory Commissions do not act within 45 days of filing the application.
For developers, the proposed supply-side resolution framework requires them to choose one of three options for stranded LoAs. Developers may cancel the LoA while retaining connectivity; swap an LoA with a PPA signed under another LoA along with extended commissioning timelines; or opt for a penalty-free exit by surrendering connectivity and receiving the return of connectivity bank guarantees. If no option is selected within the stipulated period, the penalty-free exit route will be treated as the default option. The proposed measures do not involve any direct fiscal or subsidy support from the Central Government.
For more details, read the draft relief package here