Power Ministry waives ISTS charges from new hydro-power projects

The government has set an ambitious plan to have 500 GW of generation capacity from non-fossil energy-based sources by 2030. Hydropower projects, being clean, green and sustainable will be of paramount importance in our clean energy transition journey.

New Delhi:In a bid to achieve India’s power requirement from renewable energy sources, the Ministry of Power on Friday issued an order for the waiver of Inter-State Transmission system (ISTS) charges on the transmission of electricity generated from new hydropower projects. The said waiver is already available to solar and wind power projects.

The government has set an ambitious plan to have 500 GW of generation capacity from non-fossil energy-based sources by 2030. Hydropower projects, being clean, green and sustainable will be of paramount importance in our clean energy transition journey. They are also essential for the integration of solar and wind power, which are intermittent in nature.

In acknowledgement of the aforesaid inherent qualities of hydro-power, the Government of India declared hydropower projects as a renewable source of power in March 2019, However, waiver of inter-state transmission charges, provided to solar and wind projects had not been extended to hydropower projects.

“In order to remove this discrepancy and to provide a level playing field to hydro projects, the Ministry of Power has now decided to extend the waiver of ISTS Charges on the transmission of power from new hydropower projects, for which construction work is awarded and PPA is signed on or before 30.06.2025,” a government official said.

The waiver or concessional charges shall be applicable for a period of 18 years from the date of commissioning of the hydropower plants. The waiver shall be allowed for Inter-state transmission charges only and not losses, the official said. “This step is expected to provide a boost to the hydro sector, which will also help improve India’s water security and bring development benefits to hilly states namely North Eastern States, Uttrakhand, Jammu and Kashmir, Himachal Pradesh etc. where most of the hydro potential is located,” the official said.