ISTS Waiver

To promote the development of renewables in RE-rich states and encourage inter-state procurement of renewables, the central government allowed waiver of ISTS charges and losses for solar and wind projects in 2016. Through various subsequent orders, the Ministry of Power (MoP) extended the deadline of ISTS waiver for some solar and wind project categories commissioned till 30th June, 2025. Recently, the ambit of the waiver has been widened for green hydrogen, large hydro plants, pumped storage hydro (PSH) and battery storage (BESS). We have tracked the several amendments and evolution of the ISTS waiver framework since 2016 below.

MoP Order 1st Dec 2022

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Date of Notification
1st December, 2022
Applicability of order
1. Applicable prospectively, i.e., from date of issue of order
2. No waiver would be provided to capacity where PPAs have already been signed.
Clarifications on certain aspects
Waiver shall be allowed for ISTS charges only and not losses.
Large Hydro
1. No ISTS charges shall be levied for transmission of power from hydro power projects where construction work is awarded and PPA is signed till 30th June, 2025. After that date, ISTS charges shall be levied for such projects as per following trajectory:
a. Where date of award of construction work and signing of PPA lies between 1.07.2025 and 30.06.2026- 25% of applicable ISTS charges
b. Where date of award of construction work and signing of PPA lies between 1.07.2026 and 30.06.2027- 50% of applicable ISTS charges
c. Where date of award of construction work and signing of PPA lies between 1.07.2027 and 30.06.2028- 75% of applicable ISTS charges
d. Where date of award of construction work and signing of PPA is after 1.07.2028- 100% of applicable ISTS charges
2. Waiver or concessional charges shall be applicable for a period of 18 year from date of commissioning of hydro power plants.