The Ministry of Power has permitted renewable energy projects originally tendered under the Inter-State Transmission System (ISTS) framework to connect through State Transmission Utilities (STUs) or Intra-State Transmission Systems (InSTS), provided the power generation project and the procuring entity are located within the same state.
The decision was communicated through an official letter dated November 10, 2026, issued by the Ministry’s New and Renewable Energy (NRE) Section. It follows a representation submitted by the National Solar Energy Federation of India (NSEFI), seeking permission for renewable energy projects tendered by Renewable Energy Implementing Agencies (REIAs) on an ISTS-connected basis to use intra-state transmission networks when supplying power to buyers within the same state.
The Ministry examined the proposal and observed that connecting renewable energy projects directly to the InSTS for intra-state power supply would generally help optimise transmission costs and benefit power procurers. Accepting the representation, the Ministry agreed to permit the proposed connectivity arrangement.
The decision provides greater flexibility in transmission planning for renewable energy projects where the generating facility and the electricity buyer, including a distribution company (DISCOM), operate within the same state. Under the revised arrangement, eligible projects will be able to use the state transmission network rather than relying exclusively on the inter-state transmission system for power delivery.
State Regulatory Approval Required
The Ministry has clarified that intra-state electricity procurement is governed by the regulatory provisions of the respective State Electricity Regulatory Commissions (SERCs). Accordingly, where the renewable energy project and the procurer are located within the same state, approval of the concerned SERC or Joint Electricity Regulatory Commission (JERC) may be obtained for the Power Purchase Agreement (PPA) or Power Sale Agreement (PSA) covering procurement through the InSTS-connected project.
This provision makes regulatory approval an important part of implementing the revised connectivity arrangement. Developers, procuring entities and implementing agencies will need to take the applicable state-level regulatory framework into account while adopting intra-state connectivity.
Changes to Future Renewable Energy Bidding Documents
The Ministry has also directed that suitable provisions be incorporated into future renewable energy bidding documents to enable InSTS connectivity wherever the generation project and the procurer are located within the same state.
The communication has been addressed to the CMDs of NTPC, NHPC and SJVN, as well as the Managing Director of the Solar Energy Corporation of India (SECI), which are among the country’s key Renewable Energy Implementing Agencies.
The move is expected to improve transmission cost optimisation for eligible projects and provide greater flexibility in renewable power procurement by state utilities and DISCOMs. By enabling the use of intra-state transmission infrastructure for same-state power supply, the decision could also help reduce avoidable transmission-related expenditure.
The Ministry’s decision establishes an enabling framework for eligible ISTS-tendered renewable energy projects; its implementation will depend on the applicable regulatory approvals and the provisions incorporated into future bidding documents.
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