India’s Ministry Of New Energy Has Recommended That The Electricity Regulator Postpone The Implementation Of A Tightening Plan For The Renewable Energy Deficit Settlement Mechanism

 

India's Ministry of New Energy has recommended that the electricity regulator postpone the implementation of a tightening plan for the renewable energy deficit settlement mechanism.

 

India's Ministry of New and Renewable Energy has urged the Central Electricity Regulatory Commission (CERC) to postpone the implementation of a stricter deviation assessment mechanism for wind and solar power generators. The draft mechanism, scheduled to take effect in April 2026, aims to gradually reduce the permissible deviation between generators' committed power output and actual output.

 

In a letter to the CERC on October 21, the Ministry stated that forecasting errors in renewable energy power plants are primarily caused by unpredictable weather conditions, making penalties for deviations "imprudent" and beyond developers' control. The ministry warned that higher deviation assessment fees could hinder investment by small and medium-sized enterprises (SMEs) and have a "catastrophic impact" on the clean energy sector.

 

The ministry recommended that the CERC consult with stakeholders and propose mandating energy storage in future projects, rather than imposing strict penalties. It also suggested utilizing improved meteorological data to set more realistic forecast limits. India considers wind and solar power key drivers of its energy transition, aiming to double its non-fossil fuel power generation capacity to 500 gigawatts by 2030.