The sun doesn't take orders.
The wind doesn't follow a schedule.
But India's power regulator wants to penalise them like they do.
That's the fight brewing right now between the Ministry of New and Renewable Energy and the CERC.
And it could quietly reshape the economics of every future solar and wind project in the country.
It's called the Deviation Settlement Mechanism — or DSM.
Think of it as the grid's speeding ticket.
If you promise 100 MW at 2pm and deliver 80… you pay.
If you overshoot… you also pay.
For a thermal plant, fine — you control the coal, you control the output.
But for a solar farm? A single cloud can wreck your forecast.
In its Third Amendment draft (coming into force July 1, 2026), the regulator wants to:
On paper, it sounds fair.
In practice, MNRE is waving a red flag.
Treat renewables like coal plants and three things happen:
💸 Tariffs go up — because developers will price in the risk of getting penalised for weather
🏦 Bankability drops — lenders hate uncertainty, and clouds are very uncertain
📉 Investment slows — right when India needs it most
India has already crossed 150 GW of solar and 56 GW of wind.
Renewables now sit above 185 GW, and thermal has slipped to under 50% of the total mix for the first time.
The country is chasing 500 GW of non-fossil capacity by 2030.
That's a mountain. And you don't climb it by making the climb more expensive.
Not a free pass. A smarter system:
This isn't really about a regulation.
It's about a philosophy.
Do you treat renewables like adults who must play by the same rules as coal?
Or do you accept that intermittency is the price of clean power — and design the grid around it?
MNRE just picked its side.
Now CERC has to pick its own.
And whichever way this goes, it will quietly decide how fast India's green transition actually moves.
That's all for now!
