India Moves to Rescue Renewable Energy Projects Stalled by Grid Shortages

The Indian government is considering waiving transmission charges for renewable energy developers who face delays in commissioning their projects due to a lack of transmission lines. According to a Reuters report, the relief will only apply to projects with signed power sale contracts of at least seven years by the end of 2025. The government has been phasing out interstate transmission charges for alternative energy projects since July 2024.

However, numerous solar, wind, and hybrid power generation projects have been delayed due to insufficient transmission capacity. The Central Electricity Regulatory Commission will also consider extending the relief to battery storage projects as India seeks to diversify its electricity generation away from coal and gas. India aims to build 500 GW of non-hydrocarbon generation capacity by 2030, with solar currently making up 29% of this capacity.

Plans are to expand this to over 292 GW by 2030, but this target is threatened by recent legislative changes aimed at reducing dependence on imported solar components. While solar power generation in India has surged, adding 44 GW of new capacity in the financial year 2025/26, it has been hindered by the shortage of transmission lines.

Meanwhile, coal dominates India's power generation, accounting for around 70% of total generation, which is projected to fall below 50% by 2035 due to the growth in wind and solar.