Mumbai : The norms issued by the Central Electricity Regulatory Commission (CERC) for granting connectivity to renewable energy-based projects proposing to use the inter-state transmission system (ISTS) is positive for power producers, an Icra report said.
But the rating agency noted that the uncertainty persists on availability of adequate infrastructure to evacuate power from wind power projects bid out by the Solar Energy Corporation of India (SECI) over the past 15 months. Sabyasachi Majumdar, senior vice-president and group head, Icra Ratings, said, “The notified regulations are positive for developers in the renewable energy sector, as they provide clarity on the procedure and timelines for securing approval for connectivity from the central transmission utility.”
“Moreover, the regulations accord priority to projects holding letter of award under the tariff-based competitive bidding for granting connectivity,” he added. Icra said the regulations have been notified amidst significant uncertainty over the grant of connectivity and long-term open access for winning developers in the recent wind power auctions held by SECI.
The report estimates that the existing inter-state transmission infrastructure in the states with high wind potential may not be sufficient to provide connectivity to the 5,100 mw bid out by SECI so far. The rating agency further mentioned the augmentation of transmission infrastructure would take about 24-36 months, whereas the winning developers must commission the wind power projects within 18 months from the date of issuance of letter of award or signing of PPAs (power purchase agreements).
Also, the construction of a new substation is expected to take much longer at 24-36 months against the stipulated timeline of 18 months for commissioning wind power projects. Majumdar said prolonged delays in securing connectivity would impact the project commissioning timelines, and in turn its viability for the winning developers.
