India’s proposed regulations mandating that renewable energy producers precisely match their committed green power deliveries to the grid could reduce company profits and dampen investment in the sector, reported Reuters, citing a review of industry letters.
In its draft released in September 2025, the country's Central Electricity Regulatory Commission (CERC) put forward stricter rules for wind and solar energy generators under the Deviation Settlement Mechanism.
The draft framework seeks to gradually reduce the allowed gap between the amount of electricity that renewable producers pledge to supply and their actual generation.
Beginning in April 2026, the method for calculating these deviations will be revised, and the tolerance margin will reduce annually until 2031.
By then, domestic renewable generators aim to be treated on par with conventional power plants in terms of grid discipline.
This initiative aims to encourage renewable generators to enhance their forecasting and scheduling accuracy, ensuring grid reliability as renewables contribute more to India’s energy mix.
However, industry groups caution that the proposed rules could cause disadvantages for wind energy projects, since their generation relies on 'unpredictable' weather unlike solar, coal, and gas-fired plants, which can modulate their production.
Wind Independent Power Producers Association, in a letter to CERC that was reviewed by Reuters, stated: “These penalties could cause huge losses, especially for older projects that were built under different rules.”
The association estimated that certain wind projects might lose up to 48% of their revenue due to these changes.
This April, the association filed a legal challenge against the previous year’s regulations on deviations of power supply and planning.
The National Solar Energy Federation of India also expressed similar concerns in a letter to CERC.
The federation cautioned that the proposed rules could jeopardise project viability and discourage future investments in India’s clean energy sector.
India aims to scale up its renewable energy capacity, targeting to double its nonfossil-based power capacity to 500GW as part of its broader energy transition goals.
