No blanket cancellations of Renewable Energy projects, due diligence underway: Govt

New Delhi, Nov 4 The Government on Tuesday said it is closely monitoring the cases where Letters of Award have been issued by Renewable Energy Implementing Agencies (REIAs), but power sale agreements (PSAs) with DISCOMs or end procurers have not yet been finalised.

As of September 30, Renewable Energy Implementing Agencies (REIAs) have issued Letters of Award (LoAs) for 43,942 MW of capacity where PSAs with end procurers remain unsigned.

Some DISCOMs have expressed apprehensions in signing PSAs for such bids wherein the likely start date of connectivity for the successful bidders is in the distant future.

“REIAs have been advised to carry out due diligence by reviewing and categorising such cases based on the likelihood of securing PSAs with end procurers,” according to the Ministry of New and Renewable Energy.

This assessment would consider multiple factors, including the configuration of renewable energy envisaged to be supplied under the bid, the discovered tariff for supply of renewable power and the expected timeline for connectivity, said the ministry.

Following this review, only those LoAs with minimal or no prospects of PSA execution may be considered for cancellation on a case-to-case basis. Even then, such cancellations are expected to be phased and undertaken only after all feasible and viable options for executing the Power Sale Agreements (PSAs) and corresponding Power Purchase Agreements (PPAs) have been thoroughly explored.

To facilitate the execution of PSAs, the government has undertaken several proactive measures.

These include urging States to comply with the Renewable Consumption Obligation (RCO) under the Energy Conservation Act and advising Renewable Energy Implementing Agencies (REIAs) to aggregate demand from DISCOMs and other consumers before designing and issuing tenders.

In addition, the Standard Bidding Guidelines for solar, wind, hybrid, and Firm and Dispatchable Renewable Energy (FDRE) have been amended to allow for cancellation of Letters of Award (LoAs) that remain unexecuted beyond 12 months from the date of issuance, the ministry informed.

Despite global challenges such as supply chain disruptions and tighter financing conditions, India added around 29 GW of renewable energy capacity (excluding large hydro) in the last financial year, and around 25 GW has already been added in the first half of FY 2025-26.

This growth is being driven not only by central and state-led bids but also by commercial and industrial consumers. Investor interest remains strong, with a clear shift toward integrated and storage-backed portfolios, according to the Ministry of New and Renewable Energy.

From around 35 GW in 2014, the country now has over 197 GW of installed capacity, excluding large hydro.

The Rs 2.4 lakh crore investment plan for transmission associated with 500 GW of renewable energy, along with recent amendments to the General Network Access (GNA) regulations, is designed to unlock stranded capacity and enable dynamic corridor sharing.

These reforms are expected to ease congestion and improve grid access in renewable-rich states.

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