After a year-and-a-half-long consultation process, the Central Electricity Regulatory Commission (CERC) has notified its regulations on ‘Sharing of Inter State Transmission Charges and Losses’. These regulations would implement the point of connection method of sharing the cost of inter-state transmission services in India, replacing the present system of regional postage stamps. The new mechanism is expected to benefit the transmission network development and users of the transmission system.
At present, the transmission investments are faced with the uncertainty in generation and also the cumbersome process of getting the Bulk Power Transmission Agreements (BPTAs) signed by all the expected beneficiaries of the transmission system. However, under the new mechanism, all the users would be default signatories to the Transmission Service Agreement, which also requires these users to pay the point of connection charge, which covers the revenue of transmission licensees. This commercial arrangement would also facilitate financial closure of transmission investments.
It would facilitate integration of electricity markets and enhance open access and competition by obviating the need for pan-caking of transmission charges.
The regulations would facilitate solar-based generation by allowing zero transmission access charge for the use of inter-state transmission system (ISTS) and allocating no transmission loss to solar-based generation. Solar power generators shall be benefited in the event of use of ISTS.
Since such generation would normally be connected at 33 kV, the power generated by such generators would most likely be absorbed locally. This would cause no or minimal use of 400 Kv ISTS network and may also lead to reduction of losses in the 400 Kv network by obviating the need for power from distant generators.