Energy transition . Govt waives ISTS charges on new hydro-power projects for 18 years

The Power Ministry on Friday said it has waived inter-state transmission system (ISTS) charges on transmission of electricity generated from new hydro-power projects for 18 years.

The waiver is already available to solar and wind power projects and is part of the government’s efforts to achieve its power requirement from renewable energy (RE) sources, the Power Ministry said in a statement.

Clean energy

“Hydro-power 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,” it added.

In acknowledgement of the aforesaid inherent qualities of hydro-power, the government declared hydro power projects as the renewable source of power in March, 2019. However, waiver of ISTS charges, provided to solar and wind projects, had not been extended to hydro power projects.

In order to remove this discrepancy and to provide a level playing field to hydro projects, the Ministry has now decided to extend the waiver of ISTS charges on the transmission of power from new hydro power projects, for which construction work is awarded and PPA is signed on or before June 30, 2025.

Boost to the sector

The waiver or concessional charges shall be applicable for 18 years from the date of commissioning of the hydro power plants. The waiver shall be allowed for inter-state transmission charges only and not losses. The waiver would be made applicable from prospective date.

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.