Cabinet OKs Rs 1.86 lakh crore Green Energy Corridor Phase-III plan

The Union Cabinet greenlit the Rs 1.86 lakh crore Green Energy Corridor Phase-III scheme. It aims to build transmission for 135 GW of renewable power and deploy 50 GWh of battery storage, ensuring grid stability for non-fossil energy.

The Union Cabinet on Wednesday approved the Rs 1.86 lakh crore Green Energy Corridor Phase-III scheme to build transmission infrastructure for evacuation of up to 135 GW of renewable power and deploy 50 GWh of battery storage, as India prepares its grid for a sharp expansion in non-fossil energy capacity.

Union Minister Ashwini Vaishnaw, announcing the decision after the Cabinet meeting, said adequate transmission capacity would be critical as renewable generation rises, with the government seeking to ensure that grid infrastructure comes up ahead of new renewable projects. A presentation made during the briefing said that without adequate transmission infrastructure, renewable power could face curtailment, and stressed that transmission capacity needed to precede renewable-energy capacity addition.

Scheme Outlay and Financials

The scheme, targeted for completion by FY 2032-33, has a total project outlay of Rs 1,86,405 crore. Of this, Rs 1,36,378 crore will go towards strengthening intra-state transmission systems, while Rs 50,000 crore has been earmarked for deployment of 50 GWh of Battery Energy Storage Systems. The Centre will provide financial assistance of Rs 54,082 crore.

Addressing Renewable Energy Integration Challenges

The scale of the scheme reflects the growing challenge of integrating larger volumes of solar and wind power into the grid. Unlike conventional generation, renewable output varies with sunlight and wind conditions, requiring stronger transmission networks as well as storage to balance supply and demand. The battery systems can be installed at renewable-energy generation sites or other locations considered important for grid flexibility. According to the Cabinet release, they are intended to address intermittency, transmission congestion, peak-hour curtailment and demand during non-solar hours.

National Energy Targets and Capacity Expansion

The government said the corridor will enable evacuation of up to 135 GW of renewable power across states and Union Territories. Vaishnaw's presentation said India is targeting 500 GW of non-fossil fuel capacity by 2030 and is planning for around 786 GW by 2035-36. The Cabinet release separately said the scheme would contribute towards the longer-term target of 900 GW of installed non-fossil capacity by 2035.

India's rapidly expanding solar capacity is already increasing the need for supporting grid infrastructure. According to an official PIB backgrounder, India's installed solar capacity had reached 162.15 GW by June 30, 2026, up from around 3 GW in 2014.

Implementation and Bidding Process

Under GEC-III, all new or greenfield intra-state transmission projects will be awarded through tariff-based competitive bidding. Transmission service providers selected through the bidding process will build, own, operate and maintain the assets, while State Transmission Utilities will act as the overall implementing agencies. Upgradation and strengthening of existing, or brownfield, transmission networks will be carried out on a cost-plus basis.

The government said the central assistance would help offset intra-state transmission charges and limit their impact on electricity costs for consumers. The scheme also marks a significant expansion of India's Green Energy Corridor programme, which was originally designed to strengthen transmission networks in states with high renewable-energy potential. With renewable generation expanding faster, the focus is increasingly shifting from merely creating generation capacity to ensuring that electricity can be transmitted, stored and supplied when it is needed. (ANI)

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