INOX Wind, JSW Energy rally up to 9% on govt's ISTS charge waiver

Shares of clean energy stocks surged up to 9% on Tuesday, led by INOX Wind and JSW Energy, a day after the government announced a complete waiver of the inter-state transmission system (ISTS) charge for offshore wind, hydrogen and ammonia projects. 

Cheering the news, INOX Wind shares rallied 9.4% to hit an intraday high of ₹146.60 against the previous closing price of ₹134 on the BSE.

Similarly, JSW Energy share price jumped as much as 6.5% to touch a high of ₹269.30 compared with Monday’s closing price of ₹252.85.

Bucking the trend, Adani Green Energy, INOX Green Energy, and Indian Energy Exchange were down up to 1%.

The Ministry of Power in a notification issued on Monday announced a complete waiver of ISTS charges for offshore wind power projects and extended the waiver to green hydrogen and ammonia. This decision was taken to facilitate wider execution of offshore wind energy initiatives, to promote the expansion of green hydrogen and ammonia projects and to encourage the offtake of renewable energy from energy storage system projects.

As per the notification, a complete waiver of ISTS charges will be given for offshore wind power projects commissioned on or before December 31, 2032 for a period of 25 years from the date of commissioning of the project. The off-shore projects commissioned from January 1, 2033 would be given graded ISTS charges.

“Earlier, all wind energy projects were provided waiver up to June 30, 2025. Now, offshore wind would be treated separately, and waiver to these would granted up to December 31, 2032 with graded transmission charges thereafter,” the power ministry said in a release.

The government has also granted complete waiver of ISTS charges for a period of 25 years from the date of commissioning of the project, for green hydrogen and green ammonia production units, using renewable energy (commissioned after March 8, 2019), pumped storage system or battery storage systems or any hybrid combination of these technologies.

“The projects commissioned on or before December 31, 2030 shall be eligible for this waiver. The projects after December 31, 2030 will attract graded transmission charges thereafter. The decision effectively extends the applicability of waiver date from 30 June 2025 to 31 December 2030,” it added.

To promote development of Pump Storage Plants (PSP), the criteria for availing the complete waiver of ISTS charges for PSP projects has now been linked to the date of award of the project rather than commissioning of the project. This will be applicable in cases where construction work is awarded on or before June 30, 2025.

The ISTS charges on drawl of energy from energy storage projects, which was earlier granted to the project, will be available for each individual user of such project. The individual user will get this benefit, if at least 51% of the energy utilized by the user for charging the storage system is renewable energy. Earlier the limit of 51% was at project level.

“This change has been proposed in view of the fact that in future the capacity of such storage projects will be shared by many discoms / other users and only some of them may meet this criteria of 51% individually while the same may not be met in an aggregate manner at storage project level,” the release noted.

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