CERC Finalizes One-Time Mechanism to Unlock 15.7 GW of Stranded Transmission Capacity; CTUIL to Facilitate Release of Surrendered Slots

The 15.7 GW Regulatory Breakthrough

In a decisive move to de-clog India’s green energy pipeline, the Central Electricity Regulatory Commission (CERC) has issued a regulatory order establishing a one-time mechanism to address approximately 15.7 GW of stalled Inter-State Transmission System (ISTS) connectivity. This intervention specifically targets renewable energy projects holding legacy Letters of Award (LoAs) where Power Purchase Agreements (PPAs) have remained unsigned for more than 12 months following the LoA issuance. By addressing these “stranded” allocations, the regulator aims to ensure that scarce transmission infrastructure is utilized by viable projects rather than being held by stalled developments.

The Problem: Analyzing the Connectivity Backlog

The current transmission bottleneck stems from a significant disparity between the capacity granted connectivity and the projects that have successfully secured off-take agreements. Between 2019 and June 2025, Renewable Energy Implementing Agencies (REIAs)—which include SECI, NTPC, NHPC, and SJVN—issued over 40 GW of LoAs. However, only a small fraction of this capacity has progressed to a signed PPA, leaving over 22 GW in a state of regulatory limbo.

A critical nuance in the current data is that while 15.7 GW is identified for potential release, this figure may fluctuate. REIAs have indicated that active PPA discussions are currently underway for an additional 2,490 MW of capacity. If these negotiations prove successful, the net volume of released capacity will decrease accordingly. The CERC has set a 12-month threshold as the definitive criterion for eligibility; any project failing to secure a PPA within a year of its LoA is now subject to this mechanism.

ISTS Connectivity Status: 2019 – June 2025

The One-Time Mechanism: Four Options for Developers

To resolve the backlog, the CERC has provided affected developers with four distinct pathways to manage their connectivity status. These options are designed to balance developer flexibility with the urgent need for grid efficiency:

• Option 1: Substitution. This allows a developer to substitute a project that lacks a PPA with a different project that has successfully secured a signed PPA. This ensures that the reserved transmission slot is immediately utilized by a project ready for implementation.
• Option 2: Surrender. Developers may choose to formally surrender their ISTS connectivity. Under this path, the capacity is returned to the pool for reallocation to other renewable energy applicants currently waiting for grid access.
• Option 3: Exit. This option provides a pathway for developers to exit their current connectivity arrangements entirely. This is particularly relevant for projects that cannot meet the 12-month PPA requirement and wish to avoid the potential financial penalties or the more stringent technical requirements associated with the transition to the new GNA regime.
• Option 4: Continued Compliance. Entities may opt to retain their current connectivity, provided they commit to moving forward under the existing General Network Access (GNA) Regulations. This requires full adherence to the updated regulatory framework, which governs how electricity is scheduled and transmitted across the national grid.

Management of Released Capacity and CTUIL’s Role

The Central Transmission Utility of India Limited (CTUIL) is the designated authority for managing the transition and reallocation of the unlocked capacity. CTUIL is responsible for the administrative oversight of the entire mechanism, which includes the identification of all eligible projects and the subsequent management of the released or utilized capacity.

Once developers have made their selections, CTUIL will oversee the process of making surrendered capacity available to the broader market. This ensures that the 15.7 GW—or the net remaining after successful PPA negotiations—is transitioned away from stalled legacy projects and toward active developments that can contribute to India’s renewable energy targets.

Implementation Timeline and Deadlines

The CERC has mandated a strict implementation schedule to prevent further delays in grid utilization. The timeline for affected entities is as follows:

• Publication of Eligibility: CTUIL is tasked with publishing the final list of projects and entities that fall under the 12-month unsigned PPA criteria.
• 60-Day Selection Window: From the date of the publication of the final eligibility list, all affected entities have exactly 60 days to formally select and declare one of the four options (Substitution, Surrender, Exit, or GNA Compliance).

Source Attribution

All data and regulatory details in this report are derived from the CERC 11-SM-2026 order and related regulatory proceedings involving the Central Electricity Authority (CEA) and implementing agencies.

Official Sources

• Central Electricity Regulatory Commission (CERC) Suo Motu Order:
  • Document: Order in Petition No. 11/SM/2026 – “One-time mechanism for release of stranded transmission connectivity.”
  • Link: CERC Order 11-SM-2026
• Central Electricity Authority (CEA) Meeting Minutes:
  • Document: Minutes of the 36th Meeting of the National Committee on Transmission (NCT) held on 30th December 2025.
  • Link: CEA – NCT 36th Meeting Minutes (Referenced document index: CEA-PS-12-13/3/2019-PSPA-II)