Lok Sabha Question No. 1475 (UNSTARRED), answered on 2025-02-13
Subject: Inter-State Transmission System
Ministry: POWER
Asked by: Shri Jaswantsinh Sumanbhai Bhabhor, Shri Rajkumar Chahar

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA UNSTARRED QUESTION NO.1475 ANSWERED ON 13.02.2025

## INTER-STATE TRANSMISSION SYSTEM

†1475. SHRI JASWANTSINH SUMANBHAI BHABHOR: SHRI RAJKUMAR CHAHAR:

Will the Minister of POWER be pleased to state:

- (a) the specific tariff revision measures introduced to reduce hydropower tariff;
- (b) the time by which the Inter-State Transmission System charge waiver for hydro electric projects and pumped storage projects are likely to remain effective; and
- (c) the  specific  benefits  being  provided  to  large  hydropower  projects  after  being declared as renewable energy sources?

A N S W E R

THE MINISTER OF STATE IN THE MINISTRY OF POWER

(SHRI SHRIPAD NAIK)

(a) & (c) : To make hydropower attractive, the Government of India has approved the following measures:

- 1) Budgetary support for flood moderation/ storage hydro electric projects (HEPs).
- 2) Budgetary support for cost of enabling infrastructure for HEPs viz. reimbursement of cost incurred against (i) roads/ bridges (ii) railway sidings (iii) transmission  system  upto  pooling  point  including  upgradation  of  pooling  substation (iv) communication infrastructure and (v) ropeways.
- 3) Waiver  of  Inter-State  Transmission  System  (ISTS)  charges  for  transmission  of power from HEPs and Pumped Storage Projects (PSPs).
- 4) Ministry of  Power  vide  OM  dated  08.03.2019  has  given  flexibility  to  the developers to determine tariff by (i) back loading of tariff after increasing project life  to  40  years,  (ii)  increasing  debt  repayment  period  to  18  years  and  (iii) introducing escalating tariff of 2%.

........2.

Besides,  the  Government  has  provided  following  benefits  to  large  hydro  power projects:

- 1) Hydro Purchase Obligation (HPO) as a separate entity within Non-solar Renewable Purchase Obligation (RPO).
- 2) Central Financial Assistance (CFA) to the State Governments of North Eastern Region (NER) towards their equity participation for development of HEPs in the NER through Joint Venture (JV) collaboration between State entities and Central Public Sector Undertakings.
3. (b) : As per Central Electricity Regulatory Commission (Sharing of Inter-State Transmission  Charges  and  Losses)  (First  Amendment)  Regulations,  2023,  no  ISTS charges are to be levied on the transmission of power from HEPs where (a) PPAs are signed on or after 01.12.2022 but on or before 30.06.2025 and (b) construction work is awarded  on  or  before  30.06.2025.  Subsequently,  ISTS  charges  shall  be  levied  on hydroelectric  projects  where  construction  work  is  awarded  and  PPA  is  signed  after 30.06.2025 as per the following trajectory:

|   Sl. No. | Date of signing of PPA and award of construction work   | ISTS charges                    |
|-----------|---------------------------------------------------------|---------------------------------|
|         1 | 01.07.2025 to 30.06.2026                                | 25% of applicable ISTS charges  |
|         2 | 01.07.2026 to 30.06.2027                                | 50% of applicable ISTS charges  |
|         3 | 01.07.2027 to 30.06.2028                                | 75% of applicable ISTS charges  |
|         4 | From 01.07.2028                                         | 100% of applicable ISTS charges |

The  waiver  has  been  granted  for  a  period  of  18  years  from  the  date  of commissioning of these projects.

For Pumped Storage Projects, as per Central Electricity Regulatory Commission (Sharing of Inter-State Transmission Charges and Losses) (First Amendment) Regulations,  2023  read  with  Ministry  of  Power's  Order  No.  12/07/2023-RCM  dated 29.05.2023, no ISTS charges are to be levied on the transmission of power from PSPs where construction work is awarded till 30.06.2025. Subsequently, ISTS charges are to be  levied  on  PSPs  where  construction  work  is  awarded  after  30.06.2025  as  per  the following trajectory:

|   Sl. No. | Award of construction work   | ISTS charges                    |
|-----------|------------------------------|---------------------------------|
|         1 | 01.07.2025 to 30.06.2026     | 25% of applicable ISTS charges  |
|         2 | 01.07.2026 to 30.06.2027     | 50% of applicable ISTS charges  |
|         3 | 01.07.2027 to 30.06.2028     | 75% of applicable ISTS charges  |
|         4 | From 01.07.2028              | 100% of applicable ISTS charges |

The  waiver  has  been  granted  for  a  period  of  25  years  from  the  date  of commissioning of these projects.

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