India’s power sector represents a complex ecosystem involving multiple stakeholders – from central planners and regulators to utilities and developers. Recent discourse on transmission delays has highlighted systemic challenges that demand objective analysis.
While there is broad consensus on the need for holistic approaches, such approaches must also confront execution timelines, competitive dynamics, and the real costs borne by renewable energy developers and the national energy transition itself.
Curtailment and Revenue Losses
Transmission delays aren’t hypothetical concerns – they represent material financial and clean-energy losses with measurable consequences. Between March and August 2025, Rajasthan curtailed nearly 4 GW of clean power, with output sometimes reduced by over half during peak months. This represents wasted clean energy and lost revenue for developers.
Similar curtailments and stranded capacity are reported in Gujarat and Maharashtra, where evacuation constraints have forced generators to reduce output despite capacity being ready and willing to supply.
Independent industry data show that over 50 GW of renewable capacity across India remains stranded because transmission infrastructure isn’t available in time, particularly in high-renewable states like Rajasthan and Gujarat. These are systemic issues with measurable costs.
Renewable developers are now formally seeking redress. ACME Solar, Ampin Energy, and Juniper Green have filed separate petitions before the Central Electricity Regulatory Commission seeking compensation for generation loss and consequent financial losses due to curtailment until operationalization of associated transmission systems.
These petitions underscore that developers are facing real financial stress because completed projects cannot evacuate power due to delayed grid readiness.
Transmission Delays Are About Timelines
A holistic assessment of power sector challenges must include planning, regulatory coordination, statutory clearances, and inter-agency roles. However, such assessment must also confront execution timelines and identify constraints that directly affect project viability.
Latest official data show that in FY 2025, the country added only 8,830 circuit km of interstate transmission lines against a target of 15,253 circuit km – a 42% shortfall and the lowest addition in a decade. Many urgent transmission corridors – including those earmarked to evacuate solar and wind energy from Rajasthan and Gujarat – are delayed by 18-24+ months.
These delays are far more consequential than theoretical framework debates. They directly affect generation absorption, market readiness, revenue flows, and investor confidence.
Market Concentration and Competitive Distortions
PGCIL’s execution dominance raises serious questions. It currently handles 46 of 91 ISTS projects under construction, valued over ₹1.27 lakh crore, plus another ₹46,500 crore in regulated-tariff projects.
Several structural factors distort competition. First, PGCIL’s sovereign backing delivers substantially lower borrowing costs versus private players. Second, it executes RTM projects outside competitive bidding, yielding 15.5% ROE and stable cashflows – enabling aggressive TBCB bidding that private players cannot sustainably match.
Third, a structural conflict exists: CTUIL, the transmission planning nodal agency, is PGCIL’s wholly-owned subsidiary. This creates perceptions that schedule extensions come easier for the incumbent. Reports of penalty waivers suggest delay costs aren’t always internalized, enabling unrealistically low bids.
Consider PGCIL’s announced ₹3 lakh crore investment target by FY2032 against recent execution of ₹12,500 crore (FY2024) and ₹26,000 crore (FY2025). This demands a sharp step-up from historical levels.
Awarding even larger project shares to the same entity, despite clear bandwidth constraints, amplifies single-point-of-failure risk for national transmission expansion.
What Needs to Be Done
There is broad consensus that a holistic approach is needed, but ‘holistic’ must include ‘result-oriented’.
Decentralise Transmission Execution
Current norms concentrate a majority of ISTS project execution with a single institution. While institutional capabilities are important, execution resilience improves with a more diversified project pipeline that includes genuine private sector participation, proper competition, and balanced risk sharing.
To address these distortions and ensure execution resilience, regulatory frameworks should establish a clear cap limiting any single entity’s share of ISTS projects to a maximum of 50% of the total pipeline, just as competitive norms govern renewable generation auctions.
Predictable Time-Bound Delivery and Clear Accountability
Delays in statutory clearances and right-of-way acquisition remain a major bottleneck across the system and need to be resolved urgently. Implementing single-window approvals with fixed timelines – and tying performance incentives or penalties to project milestones – will help align execution timelines across agencies and contractors.
Curtailment Mitigation Through Operational Flexibility
While grid expansion catches up, near-term mitigation measures should include dynamic line ratings and advanced grid tools to improve transmission utilization, local storage deployments to reduce pressure on evacuation lines, and revised dispatch protocols that reduce unnecessary curtailment when grid conditions permit.
A Forward-Looking Sector
A holistic approach does not mean glossing over measurable gaps. Rather, it means integrating planning, performance, accountability, and investor confidence. If transmission expansion cannot keep pace with generation pipelines, renewable targets become harder to achieve and financing those targets gets riskier.
If curtailment continues unchecked, India risks not just missed clean energy targets, but also supply shortages, higher costs for consumers, and erosion of India’s climate leadership. India’s renewable goals are ambitious and achievable – but they depend on a transmission system that is not just collaborative, but also predictable, timely, and aligned with generation growth.
Conclusion
Constructive critique and holistic planning are both necessary. But so are results, timelines, and accountability. A balanced roadmap must address systemic coordination challenges while also tackling execution bottlenecks and competitive distortions head-on.
This includes establishing equitable conditions for all participants – such as uniform guarantee requirements, market concentration limits, and clear separation between planning and execution functions – to ensure fair competition and execution resilience for the benefit of renewable developers, grid operators, consumers, and the nation’s climate goals.
(Dhanendra Kumar has been India’s Executive Director at the World Bank and First Chairman of CCI. He is currently Chairman of Competition Advisory Services India LLP; Views expressed are personal)
