The Ministry of New and Renewable Energy (MNRE) has requested a delay in the draft regulations proposed by the Central Electricity Regulatory Commission (CERC), which would impose stricter penalties on wind and solar power generators for deviations between their committed and actual power supply. The ministry argued that such rigid rules, particularly under the Deviation Settlement Mechanism (DSM), could discourage new investments and threaten the financial viability of existing renewable projects.

The draft framework, released in September 2025, aims to gradually narrow the allowable difference between scheduled supply and actual generation. The tighter rules are set to come into effect from April 2026 and are expected to become even stricter by 2031. The stated aim is to enhance grid discipline and reliability as renewables increase their share of India’s energy mix.

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However, MNRE pointed out that wind and solar output remain inherently weather-dependent, making accurate forecasting difficult, especially in India’s diverse climatic conditions. Penalising deviations, the ministry said, would be “imprudent” and would put developers, especially small and medium-sized firms, at an unfair disadvantage.

As an alternative, MNRE suggested the regulator consider mandating energy storage integration in future renewable contracts to help stabilise supply, and utilise improved weather forecasting data and flexible scheduling rather than enforcing punitive deviation charges.

The move highlights a crucial tension in India’s energy transition: balancing the need for grid reliability and stability against the importance of maintaining investor confidence in renewable energy. With India aiming for 500 GW of non-fossil power capacity by 2030, the outcome of this regulatory push will likely have significant implications for the pace and viability of future green-power installations.

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