Page 60 - Policy Economic Report - Jan 2026

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

• Regulatory Commissions, in consultation with Appropriate Governments, may exempt the
distribution licensees from the Universal Service Obligation in respect of consumers having a
contracted load of 1 MW and above.

• Strengthening of dispute resolution mechanism to reduce burden on Regulatory Commissions,
enable faster dispute resolution and reduce financial burden on consumers.

3. Renewable Energy Generation & Storage:

• RE capacity addition through market-based mechanisms and captive power plants.

• Installation of storage by distribution licensee on behalf of small consumers to get benefit of
economies of scale and by bulk consumers themselves to facilitate adoption of Distributed
Renewable Energy (DRE) sources.

• Trading of surplus energy from DRE as well storage by consumers themselves (P2P) or through
aggregators.

• Parity between RE and conventional sources in scheduling and deviation by 2030.

• Market-based deployment of storage, use of emerging Battery Energy Storage System (BESS)
technologies, domestic manufacturing of cells and other components of BESS and demand side
incentives like VGF for BESS and pumped storage projects.

4. Thermal Generation:

• Integration of storage, and repurposing of older units for grid support to enable greater
renewable energy integration.

• Exploring possibility of direct utilization of the steam generated from thermal plants for
applications such as district cooling or industrial processes for optimum utilization.

5. Nuclear Generation:

• In line with the provisions of SHANTI Act, 2025, adoption of advanced nuclear technologies,
developing Modular Reactors, setting up Small Reactors, and use of nuclear energy by commercial
and industrial consumers to achieve 100 GW by 2047.

6. Hydro Generation:

• Accelerated development of storage-based hydroelectric projects for flood moderation,
irrigation, and water as well as energy security.

7. Power Markets:
• A strong regulatory framework for market monitoring and surveillance to prevent collusion,

gaming, or market dominance.

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