Cabinet approves PM-DHARA (PM-Developing Harmonized and Accelerated Renewable-energy Access) Scheme for Development of Intra-State Transmission System with Battery Energy Storage Systems

1. At a Glance

• GEC-III is a Cabinet-approved scheme to strengthen India's Intra-State Transmission System (InSTS) so that up to 135 GW of renewable energy can be evacuated across States/UTs. It also adds 50 GWh of Battery Energy Storage Systems (BESS) [1].
• It is the third intra-state phase of the Green Energy Corridor programme, after GEC-I (~24 GW, 8 States) and GEC-II (~20 GW, 7 States) [1][2].
• It combines grid expansion with storage for the first time in the InSTS track. The storage is meant to address intermittency, congestion, peak-hour curtailment and non-solar-hour demand [1].
• UPSC relevance: it links the 900 GW non-fossil capacity by 2035 target, energy security, federalism (States implement, Centre part-funds) and transmission PPP models (TBCB/BOOM) [1].

2. Why in the News

• 30 Sep 2026: The Union Cabinet, chaired by PM Narendra Modi, approved GEC-III with a total outlay of ₹1,86,405 crore and Central Financial Support of ₹54,082 crore [1].

3. Background & Evolution

• Rationale: Most RE capacity sits in resource-rich States. Without dedicated intra-state evacuation lines, projects get stranded or curtailed. The CFA offsets intra-state transmission charges and keeps power costs down [1].
• Milestones:
• GEC-I (InSTS): 8 States (Andhra Pradesh, Gujarat, Himachal Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan, Tamil Nadu). About 24 GW RE, 9,700 ckm of lines, 22,600 MVA of substations, estimated cost ₹10,141.68 crore, CFA 40%. Completion was originally expected by 2022 [2].
• 06 Jan 2022, GEC-II (InSTS): Approved by the CCEA. About 10,750 ckm of lines and 27,500 MVA, for about 20 GW in 7 States (Gujarat, Himachal Pradesh, Karnataka, Kerala, Rajasthan, Tamil Nadu, Uttar Pradesh). Cost ₹12,031.33 crore, CFA 33% (₹3,970.34 crore), period FY 2021-22 to 2025-26 [2][4].
• GEC-II (ISTS), Ladakh: A separate inter-state scheme approved by Cabinet for a 13 GW RE project in Ladakh [3].

• 30 Sep 2026, GEC-III (InSTS + BESS): 135 GW evacuation plus 50 GWh BESS, target completion FY 2032-33 [1].

• Taken together: GEC-I and GEC-II cover ~44 GW across 10 distinct States. GEC-III is about 3x that combined scale [1][2]. (Derived from the figures above.)

4. Core Static Facts

• Figures that don't add up: The InSTS and BESS components together come to ₹1,86,378 crore. That is ₹27 crore less than the stated total of ₹1,86,405 crore. The release does not explain the gap [1].
• Key terms:
• InSTS is the network within a State, run by the STU.
• ISTS is the inter-state network under the central transmission utility.
• Curtailment means RE output that is forced down because the grid cannot absorb it.
• GWh measures energy (storage capacity). GW measures power.

5. Multi-Dimensional Analysis

Economic

• The CFA offsets intra-state transmission charges, which should lower the delivered cost of power for consumers [1].
• The scheme is expected to create direct and indirect jobs in power, manufacturing and construction. BESS work adds jobs in the domestic storage industry [1].
• The BESS outlay works out to about ₹1,000 crore per GWh (derived from [1]). It will signal demand to domestic cell and pack makers.

Environmental

• The release says the scheme will promote ecologically sustainable growth by cutting the carbon footprint [1].
• Less curtailment means more RE output actually reaches consumers, which improves the emissions return on money already spent on RE.

Scientific / Technological

• Storage placed at the generator end smooths solar variability. It also moves daytime solar output into evening peaks, which addresses "non-solar-hour demand" [1].
• Placing BESS at "locations of importance for grid flexibility" also points to using it for congestion relief, not only energy shifting [1].

Governance / Federalism

• It is a centrally supported but State-executed scheme: the STUs are the implementing agencies [1].
• The CFA share has fallen from 40% (GEC-I) to 33% (GEC-II) to about 29% of outlay (GEC-III). States are carrying more of the cost [1][2].

Administrative

• The split between TBCB (greenfield) and CPB (brownfield) aims to get competitive tariffs on new lines while keeping flexibility for strengthening existing networks [1].
• Risks to delivery:
• Right-of-way and land disputes.
• Uneven STU capacity across States.
• Slippage like GEC-I's, which was targeted for 2022 [2].

6. Recent Developments (last 12–18 months)

• 30 Sep 2026: Cabinet approved GEC-III: 135 GW InSTS, 50 GWh BESS, ₹1,86,405 crore [1].
• FY 2025-26: Scheduled end of the GEC-II (InSTS) implementation period [2].
• I could not verify any other dated events in this window from whitelisted sources.

7. Prelims Hooks

• GEC-III aims to evacuate up to 135 GW of RE through the intra-state network [1].
• GEC-III includes 50 GWh of BESS, allocated ₹50,000 crore [1].
• Total GEC-III outlay: ₹1,86,405 crore. Central Financial Support: ₹54,082 crore [1].
• GEC-III target completion: FY 2032-33 [1].
• Implementing agency: State Transmission Utilities, not POWERGRID or the CTU [1].
• Greenfield InSTS uses TBCB. Brownfield work uses Cost Plus Basis [1].
• TSPs participate on a BOOM model [1].
• The scheme supports the 900 GW non-fossil capacity by 2035 target [1].
• GEC-II (InSTS) was approved by the CCEA on 06.01.2022, with CFA 33% [2][4].
• GEC-II (InSTS) covers 7 States and about 20 GW, at ₹12,031.33 crore [2].
• GEC-I had 40% CFA, covered 8 States and about 24 GW, at ₹10,141.68 crore [2].
• Kerala and Uttar Pradesh are in GEC-II but not GEC-I. Andhra Pradesh, Madhya Pradesh and Maharashtra are in GEC-I but not GEC-II [2].
• A separate GEC-II ISTS scheme targets 13 GW in Ladakh [3].

8. Why the Old Phases Are the Real Test for GEC-III

• The first two phases are still not finished
• GEC-I and GEC-II together were meant to connect about 44 GW of renewable energy (RE) in 10 States [6].
• Only about 26 GW of this was actually integrated, meaning connected to the grid and able to deliver power [6].

• GEC-I was due in 2022, and GEC-II's period ends in FY 2025-26 [2]. So even the smaller target has slipped.

• GEC-III asks for about 3 times the scale, in about 7 years

• The target is 135 GW by FY 2032-33 [1].

• The system has struggled to finish 44 GW. If the pace does not change, 135 GW will not be met on time.

• Transmission targets across the sector are being missed

• In 2024-25, only 58% of the transmission lines targeted for that year were actually built [5].

• GEC-III now leans on the same State Transmission Utilities (STUs, the State bodies that build and run power lines inside a State) [1].

• The reasons for delay are specific, and GEC-III does not address them

• The Standing Committee on Energy (2024) named four causes of delay in transmission projects [5]:
  • right-of-way permissions (permission to run lines over private or forest land);
  • slow land acquisition;
  • contract disputes;
  • routes changed at the last minute to protect endangered species or avoid coal-mining areas.
• The Cabinet release says nothing on how GEC-III will deal with any of these [1]. More money alone does not clear a right-of-way dispute.

9. Why States Pay Most of the Bill

• The Centre's share is small, and it keeps falling
• Central support is ₹54,082 crore out of ₹1,86,405 crore [1].
• That leaves about ₹1,32,323 crore, roughly 71%, for States, their utilities and private developers (derived from [1]).

• Central support was 40% in GEC-I and 33% in GEC-II [2]. Every phase has shifted more of the cost to States.

• The cost finally lands on weak discoms

• An STU gets back what it spends on lines through transmission charges. Distribution companies (discoms, the utilities that sell power to homes and shops) pay these charges.
• Discoms are still making losses. PRS gives two reasons: tariffs set below cost, and high technical and commercial losses (power lost in wires or never billed) [5].

• So every rupee of State share adds pressure either to raise consumer tariffs or to push discoms deeper into loss.

• Private companies are not a free solution

• Under TBCB (tariff-based competitive bidding, where the bidder asking the lowest yearly charge wins), the private builder is paid through a transmission charge over the life of the line [1].
• This spreads the cost across many years. It does not remove it. Discoms still pay.

10. What 50 GWh of Batteries Can and Cannot Fix

• Installed capacity and actual power supplied are far apart
• Solar and wind make up 37% of India's installed capacity but produce only 13% of its electricity [5].

• The reason is that sun and wind are not available all the time. This gap is what storage is meant to close.

• 50 GWh is small next to 135 GW

• GWh measures stored energy. A 4-hour battery holding 50 GWh can give about 12.5 GW for those 4 hours (derived from [1]).
• That is under a tenth of the 135 GW the new lines are built to carry.

• So the batteries can reduce curtailment (RE output switched off because the grid cannot take it) and help with some evening peaks. They cannot move most daytime solar power into the night.

• Two central routes now fund batteries, and the release does not say how they fit together

• Viability Gap Funding (VGF, a grant that covers part of a project's cost so that it becomes profitable) for battery storage already takes 3% of the Ministry of Power's 2026-27 budget [5].
• GEC-III adds another ₹50,000 crore for batteries [1].
• Without clear rules, one project might claim money from both routes, or no one might plan batteries at the best grid locations.

11. What Should Be Done So GEC-III Does Not Repeat GEC-I

• The Ministry of Power should release central money only when work is actually done
• GEC-I and GEC-II connected only about 26 GW out of 44 GW [6].

• Paying out support when lines are energised (switched on and carrying power), not when contracts are signed, gives STUs a reason to finish.

• STUs should clear right-of-way and wildlife routes before bidding, not after

• The Standing Committee on Energy (2024) found that last-minute route changes for endangered species and coal areas delay projects [5].

• Agreeing the route with forest and mining authorities before the TBCB bid means the private builder does not inherit a dispute.

• The Ministry of Power should combine GEC-III batteries and the VGF scheme under one plan

• One list of battery sites for each State, drawn from grid-congestion data, would stop the two routes from paying twice for the same need [1][5].

• States should pair GEC-III with discom reform

• The Revamped Distribution Sector Scheme (RDSS, the Centre's scheme to cut discom losses) already takes about 60% of the Ministry of Power's 2026-27 budget [5].
• New lines only pay off if discoms can afford the transmission charges. Cutting discom losses under RDSS protects the GEC-III investment.

12. Anchors for Answers

• Data: Only about 26 GW of the 44 GW planned under GEC-I and GEC-II has been integrated into the grid [6]
• Data: Only 58% of targeted transmission lines were added in 2024-25 [5]
• Data: Solar and wind are 37% of installed capacity but only 13% of electricity generated [5]
• Report/Committee: Standing Committee on Energy (2024) named right-of-way, land acquisition, contract disputes and route diversions as the causes of transmission delay [5]
• Scheme: VGF for Battery Energy Storage Systems, a parallel central funding route for storage [5]
• Scheme: Revamped Distribution Sector Scheme (RDSS), which cuts discom losses so that discoms can pay the transmission charges GEC-III will create [5]

13. Mains Relevance

• GS-III: Infrastructure (energy); investment models (PPP, TBCB, BOOM); conservation and environment (climate commitments).
• GS-II: Centre–State relations; government policies and interventions.
• Possible question stems: 1. "Transmission, not generation, is now the binding constraint on India's renewable transition." Examine with reference to the Green Energy Corridor programme. 2. Discuss the role of Battery Energy Storage Systems in addressing intermittency and curtailment in a high-RE grid. What policy support does India need to scale domestic BESS manufacturing? 3. 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?

14. Related Topics to Study Next

• GEC-II ISTS (Ladakh 13 GW): the inter-state counterpart, and a way to learn the InSTS vs ISTS distinction [3].
• Viability Gap Funding for BESS: the parallel central support route for storage.
• ISTS charge waiver for RE: the other lever used to cut transmission costs for RE.
• National Electricity Plan (Transmission) by CEA: the source of long-term transmission and storage projections.
• PLI for Advanced Chemistry Cell (ACC) batteries: the supply side for the 50 GWh BESS.
• India's NDC and Panchamrit targets: the context for the non-fossil capacity goals.
• Pumped Storage Projects: the main alternative to battery storage.
• Electricity (Amendment) Bill and the Green Energy Open Access Rules: market reforms that affect RE flows.

15. Common Errors / Trap Areas

• Scheme name: The source release calls it "Green Energy Corridor Phase-III". Don't mix it up with PM-KUSUM, PM Surya Ghar, or an unverified acronym [1].
• InSTS vs ISTS: GEC-III is intra-state. The Ladakh 13 GW scheme is inter-state under GEC-II [1][3].
• GW vs GWh: 135 GW is evacuation (power) capacity. 50 GWh is storage (energy) capacity [1].
• Total outlay vs central share: ₹1,86,405 crore is the total outlay. The Centre gives only ₹54,082 crore [1]. CFA rates also differ by phase: 40% for GEC-I and 33% for GEC-II [2].
• Implementing agency: STUs implement the scheme. Contract modes differ: TBCB for greenfield and CPB for brownfield [1].