The Central Electricity Regulatory Commission Proposes Compensation-Based Framework For Extension Of General Network Access Milestone Timelines

The Central Electricity Regulatory Commission (“CERC”), vide order dated April 15, 2026, has proposed a procedure for levy of compensation charges to permit additional time for achieving key project milestones under the connectivity and General Network Access (“GNA”) framework (“Draft GNA Procedure”). A public hearing is proposed to be conducted, post the submission of comments, objections and suggestions from stakeholders on the Draft GNA Procedure, which were due by April 30, 2026.

The Draft GNA Procedure has been issued under the CERC (Connectivity and GNA to the inter-State Transmission System) Regulations, 2022 (“GNA Regulations”), which currently mandate strict timelines for submission of land documents, achievement of Financial Closure (“FC”), and declaration of Commercial Operation Date (“CoD”). Under the existing framework, failure to meet these milestones results in revocation of connectivity and encashment of bank guarantees, with limited relief available only through case-specific exercise of regulatory powers. 

In this background, and in light of increasing instances of project delays, CERC has proposed a structured and standardised mechanism to allow extensions of milestone timelines, subject to eligibility conditions and payment of Milestone Extension Charges (“MEC”). The Draft GNA Procedure reflects a shift towards a more calibrated approach, balancing project execution challenges with the need to ensure efficient utilisation of transmission connectivity, which is treated as a scarce resource. 

Salient features

1. Structured framework for extension of milestone timelines: The Draft GNA Procedure introduces a formal mechanism to permit additional time for achieving milestones, replacing the current case-by-case approach. Extensions may be granted for submission of land documents, achievement of FC, and CoD, subject to satisfaction of eligibility criteria and payment of applicable MEC.
2. Eligibility linked to demonstrable project progress: The Draft GNA Procedure allows extensions only where the developer demonstrates tangible progress. For land-related extensions, at least 20% of required land documents must be submitted. For FC, land availability thresholds of 50% (land bank guarantee route) or 25% (letter of award or power purchase agreement route) are prescribed. For CoD, higher thresholds apply, including land availability (100% under land route or 50% under letter of award or power purchase agreement route), along with proof of FC and engineering, procurement, and construction contract award.
3. Introduction of graded MEC: MEC is proposed as a per Megawatt (“MW”) per day charge, differentiated by milestone and duration of delay. For land document submission and FC, the base rate is INR 1,500 (Indian Rupees one thousand five hundred) per MW per day, while for CoD, the base rate is INR 3,000 (Indian Rupees three thousand) per MW per day. The charges increase progressively with delay, rising to INR 1,650 (Indian Rupees one thousand six hundred and fifty), INR 1,800 (Indian Rupees one thousand eight hundred), and INR 1,950 (Indian Rupees one thousand nine hundred and fifty) per MW per day for later FC months, and up to INR 6,000 (Indian Rupees six thousand) per MW per day for extended CoD delays, thereby creating a graded cost structure for noncompliance. 
4. Defined outer limits for extension: The Draft GNA Procedure prescribes clear caps on extensions; up to 3 (three) months for submission of land documents, 6 (six) months for FC, and 12 (twelve) months for CoD. Failure to achieve milestones within these extended timelines would result in revocation of connectivity and encashment of applicable bank guarantees in accordance with the GNA Regulations.
5. Advance payment and enforcement mechanism: MEC is required to be paid on a per-day basis, 15 (fifteen) days in advance. Failure to make advance payment would result in revocation of connectivity. In cases where milestones are achieved earlier within the prepaid period, the unutilised portion of MEC is refundable without interest.
6. Special dispensation for CoD delays linked to GNA effectiveness: The Draft GNA Procedure recognises practical constraints in commissioning where transmission infrastructure may not be ready. Accordingly, a grace period of 2 (two) months from the GNA effective date is proposed for achieving CoD without levy of MEC, after which applicable charges would apply.
7. Separate charges for multiple delays and no relaxation of core obligations: Where extensions are sought for more than 1 (one) milestone, MEC is payable separately for each. Further, grant of additional time does not alter the firm start date of connectivity, and entities remain liable for mismatch charges under applicable regulations.
8. Utilisation of compensation proceeds: The compensation collected under the Draft GNA Procedure is to be credited to the Deviation and Ancillary Services Pool Account by the nodal agency.

Conclusion

The Draft GNA Procedure marks a significant evolution in the GNA framework by introducing a structured, compensation-based mechanism for addressing delays in milestone achievement. By moving away from a purely revocation-driven regime to a graded, cost-based extension model, the proposal seeks to provide limited flexibility to developers while ensuring that scarce transmission connectivity is not held without adequate progress. Stakeholders should evaluate the implications of the proposed framework on project timelines, financing arrangements, and risk allocation, and consider providing inputs as part of the consultation process. 

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