Set out below are some of the major recent developments1 in the renewable energy sector in India:

1. Green Hydrogen

i. It seems that certain steps are being initiated to meet the objectives laid out by the Green Hydrogen Mission. Recently, the Managing Director of Solar Energy Corporation of India ("SECI") issued a statement that SECI is gearing up to emerge as the main aggregator in the green hydrogen sector and its implementation plans are under development at the inter-ministerial levels.

2. Wind, Solar and Hydro Power

i. PSPs

Recently2, the Ministry of Power, Government of India ("MoP") issued draft guidelines to promote development of pumped storage projects ("PSPs"). This step was in line with India's aggressive clean energy targets – as various energy storage models are imperative, to provide grid stability, for the percentage of RE sources to increase to 50% in our energy mix by 2030. As the energy supply from RE sources cannot be fully regulated due to their dependence on factors such as time of day, season and weather; there is a need for flexible energy generation and storage assets.

The proposed guidelines' aim is to promote the PSPs. Some of the MoP initiatives in this regard are:

❖ identification of project sites for development by Central Public Sector Undertakings;

❖ imposition of energy storage obligation for the distribution companies (to create demand for storage);

❖ waiver of inter-state transmission system ("ISTS") and other transmission charges (similar to other RE projects);

❖ provision of budgetary support by Government towards cost of enabling infrastructure for PSPs in rural areas.

Additionally, the guidelines inter alia, provide for the mechanism for allotment project sites, charges to be paid by the developer, monetization of ancillary services, utilization of exhausted mines to develop PSPs, environmental clearances for off-river PSPs, green finance etc.

While, PSPs are declared a renewable source, GST concessional rates for PSP components (akin to solar) are still awaited. Relevantly, PSPs being energy storage schemes do not have the liability to provide free power to the state (as required for other hydro projects). Further, obligations for creation of 'local area development fund' have also not been imposed on PSPs due to minimal impact these have on the environment.

ii. ALMM

On March 22, 2023, the Ministry of New and Renewable Energy, Government of India ("MNRE") amended the Guidelines for enlistment under Approved Models and Manufactures of Solar Photovoltaic Modules (Requirements for Compulsory Registration) Order, 2019. This amendment mainly provided for some exceptions from inspection of every manufacturing site of an applicant which would be applicable if:

❖ an ALMM enlisted model of a brand owner is manufactured under a co-branding arrangement in the ALMM enlisted manufacturing facility of another Original Equipment Manufacturer ("OEM") using the same manufacturing process and bill of materials; or

❖ an ALMM enlisted model of an OEM is manufactured under a co-branding arrangement in the OEM's ALMM enlisted manufacturing facility using the same manufacturing process and bill of materials but bears the brand name of another ALMM enlisted manufacturer.

Further, a new provision now mandates both the brand owner and the OEM to be enlisted in ALMM. The agreement between the brand owner and the OEM is required to specify details, such as the manufacturing capacity, execution and validity dates, and the brand owner and the OEM's information. The co-branded models would be added to the ALMM list under the brand owner's name. The enlistment would be valid for two years or until the expiration of the agreement or any ALMM enlisted model of the brand owner that does not require inspection.

iii. ISTS Charges

The MoP recently3 announced the waiver of ISTS charges on transmission of electricity ("ISTS Charges") generated from hydro power projects ("HPPs"). This waiver of ISTS Charges would extend to HPPs for which construction work is awarded and power purchase agreement ("PPA") is signed on or before June 30, 2025. Further, in relation to HPPs for which construction work is awarded and PPA is signed post June 30, 2025, ISTS Charges would range between 25% to 100% of the applicable ISTS charges, depending on the year in which the construction work is awarded and PPA is signed.

The said waiver/ concessional charges would be applicable for a period of 18 years from the date of commissioning of the HPP, and would apply only to ISTS Charges and not losses.

iv. GIB

With respect to the protection of Great Indian Bustard, the Supreme Court in Writ Petition No. 838 of 2019 (M.K. Ranjitsinh & Ors. V. Union of India & Ors.), had inter alia directed in its earlier order dated April 19, 2021 the conversion of overhead powerlines to underground powerlines owing to the risk overhead powerlines pose to the Great Indian Bustard, and the installation of divertors pending the conversion of powerlines. Thereafter, Supreme Court directed in its order dated November 30, 2020 that all bird diverters would need to comply with the quality norms laid down by a committee constituted by the Supreme Court. Recently in this regard, the MNRE has issued an office memorandum dated January 6, 2023 stating that pursuant to the said order of the Supreme Court dated November 30, 2022 it is clarified that all bird diverters would need to comply with the quality norms laid down by a committee constituted by the Supreme Court.

3. Electricity Rules, Regulations and Orders

i. On March 10, 2023, the Central Government launched a high price day ahead market and surplus power portal ("PUShP"), an initiative to ensure greater availability of power during peak demand season. This portal is an innovative initiative by the MoP and the regulator. Under long-term PPAs, distribution companies are obligated to pay fixed charges even if they do not schedule the power. With this portal, DISCOMs would be able to indicate their surplus power in block times, days, or months. DISCOMs in need of power can then request the surplus power from the portal.

ii. On March 13, 2023, MNRE announced that the Reserve Bank of India has granted the status of 'Infrastructure Finance Company' ("IFC") to Indian Renewable Energy Development Agency ("IREDA"), which was earlier classified as 'Investment and Credit Company'. With this IFC status, IREDA would be able to take higher exposure in RE financing and would also help the company to access wider investor base for fund mobilisation, resulting in competitive rates for fund raising.

iii. On March 24, 2023, the MoP issued the draft Electricity (Rights of Consumers) Amendment Rules, 2023. Key amendments proposed in this draft issued for stakeholder comments are:

❖ the smart meters would be read remotely at least once a day and other pre-payment meters to be read by an authorized representative of the distribution licensee at least once every three months;

❖ the consumers would be able to access data regarding their energy consumption through a website, mobile app, or SMS;

❖ the time of day ("ToD") tariff would be effective immediately after installing smart meters for specific categories of consumers. For commercial and industrial consumers with a maximum demand of up to 10 kW, the ToD tariff would be effective by April 16, 2024. For other consumers, except for agricultural consumers, it would be effective by April 16, 2025;

❖ the tariff for solar hours of the day must be at least 20% less than the normal tariff;

❖ the distribution licensee's website would display the tariff for each category of consumers. Consumers would be notified of changes in the tariff, fuel surcharge, and other charges and a full billing cycle ahead of time through various modes of communication.

iv. On March 17, 2023 the MoP announced that the Cabinet Committee on Economic Affairs ("CCEA") has granted exemption to NTPC Limited for making investment in its subsidiary - NTPC Green Energy Limited ("NGEL"). Further, investments in NTPC Renewable Energy Limited and its other joint ventures/subsidiaries by NGEL was also exempted by CCEA (subject to a prescribed threshold). This exemption is granted pursuant to the office memorandum issued by the Ministry of Heavy Industries and Public Enterprises, Department of Public Enterprises in relation to exercise of delegated power for establishing financial joint ventures and wholly owned subsidiaries by the Boards of Maharatna, Navratna and Miniratna Central Public Sector Enterprises. Relatedly, earlier this month on March 1, 2023 NTPC Limited had transferred its renewable energy assets to NGEL.