Evaluate the Tariff Based Competitive Bidding and BOOM models in transmission. How can State Transmission Utilities' capacity be strengthened to meet targets under GEC-III?

Green Energy Corridor Phase-III (GEC-III) was approved by the Cabinet in September 2026. It aims to evacuate up to 135 GW of renewable energy through intra-state networks by FY 2032-33. New lines are to be built under Tariff Based Competitive Bidding (TBCB) by private developers on a Build-Own-Operate-Maintain (BOOM) basis [1]. These models work well, but only if State Transmission Utilities (STUs) are capable.

Merits of TBCB–BOOM

• Price discovery: the bidder quoting the lowest yearly transmission charge wins. This beats the cost-plus approach, where costs simply pass through [1].
• Private capital: the Centre gives only ₹54,082 crore of the ₹1,86,405 crore outlay. Private Transmission Service Providers fill the gap [1].
• Lifecycle accountability: the developer owns and maintains the line for the whole contract period. This gives it a reason to build on time and to a good standard.
• Risk transfer: construction and maintenance risks move off the STU's balance sheet.

Limitations

• Cost deferred, not removed: distribution companies (discoms) pay the charges over decades. Discoms still make losses because tariffs are set below cost and technical and commercial losses are high [2].
• Risks the developer cannot manage: right-of-way and land disputes stay with the State. Delays persist: only 58% of the transmission lines targeted for 2024-25 were added [2].
• Limited scope: it does not suit upgrades of existing lines, so Cost Plus Basis is kept for that work [1].

Verdict: TBCB–BOOM suits new lines. Its results depend on the groundwork STUs do before bidding.

Strengthening STU Capacity

• Learn from past gaps: only about 26 GW of the 44 GW planned under GEC-I and GEC-II has been connected to the grid [3].
• Project readiness before bidding: STUs should finish route surveys, forest clearances and right-of-way permissions before inviting bids.
• Milestone-linked funding: the Centre's share has fallen from 40% in GEC-I to 33% in GEC-II [4] and about 29% in GEC-III [1]. Central money should be released when lines are switched on, not when contracts are signed.
• Skilled cells: dedicated units for bid management, contract monitoring and grid planning. Congestion data should guide where the 50 GWh of battery storage is placed [1].
• Discom finances: GEC-III should be paired with the Revamped Distribution Sector Scheme, which takes 60% of the Ministry of Power's 2026-27 spending [2], so that discoms can pay transmission charges.

TBCB–BOOM brings efficiency and private capital, but STUs remain central to delivering GEC-III. Better STU planning, milestone-linked funding and healthier discoms can make GEC-III a model of cooperative federalism. It would then advance India's 900 GW non-fossil target by 2035 [1] and SDG 7 (affordable, clean energy).