Cabinet Approves Green Energy Corridor Phase-III Scheme, A Big Push For 900 GW Goal 

Cabinet Approves Green Energy Corridor Phase-III Scheme, A Big Push For 900 GW Goal 

General Studies Paper III: Growth & Development, Government Policies

Why in News?

Recently, the Union Cabinet approved the Green Energy Corridor (GEC) Phase-III scheme, aiming to eliminate transmission bottlenecks. 

What is Green Energy Corridor Phase-III (GEC-III)?

• About: The Green Energy Corridor Phase-III (GEC-III) is a mega-scale, central infrastructure national project. It is engineered to build and expand state-level Intra-State Transmission Systems (InSTS). 
• Objective: Its core purpose is to enable evacuation of up to 135 GW of renewable energy across States and Union Territories.
  • The scheme aims to overcome transmission bottlenecks, improve renewable-power evacuation and strengthen grid flexibility. 
• Nodal Agency: The Ministry of New and Renewable Energy (MNRE) functions as the apex nodal ministry managing the scheme.
  • The State Transmission Utilities (STUs) will be the overall implementing agencies. 
  • Private and public Transmission Service Providers (TSPs) construct the infrastructure on a Build-Own-Operate-Maintain (BOOM) model.
• Budget Allocation: The total project outlay is ₹1,86,405 crore. Of this, ₹1,36,378 crore is earmarked for InSTS development and ₹50,000 crore for deploying energy storage.
  • GEC-III involves ₹54,082 crore of Central Financial Support.
    • This assistance will help offset intra-state transmission charges.
• Time Duration: GEC-III is structured as a long-term infrastructure mission slated for full commissioning and operational deployment by Financial Year (FY) 2032–33.
• States Covered: The primary focus spans renewable-rich territories. These include Gujarat, Rajasthan, Karnataka, Maharashtra, and Andhra Pradesh, along with various other states and Union Territories across India.
• Features:
  • Massive Evacuation Infrastructure: Expands power corridors to transmit 135 GW of electricity. It relies heavily on high-voltage lines spanning about 10,000 circuit kilometers.
  • Grid-Scale Battery Storage: Deploys 50 GWh of Battery Energy Storage Systems (BESS). This provides grid flexibility and rounds out power supply during non-solar hours.
  • Dual Execution Framework: Projects follow a split development model. It uses Tariff-Based Competitive Bidding (TBCB) for greenfield projects and Cost-Plus Basis (CPB) for brownfield upgrades. 
• Significance: GEC-III supports energy security by enabling larger domestic renewable-power utilisation and reducing grid constraints.
  • It also contributes to decarbonisation, lower carbon footprints and India’s longer-term target of 900 GW installed non-fossil capacity by 2035. 
  • It can create employment in transmission, manufacturing, construction, BESS and skilled grid-management activities.
  • It can also accelerate the domestic manufacturing of advanced chemistry battery cells and high-voltage transformers.

Green Energy Corridor: Origin, Phase-I and Phase-II

• Origin: The Green Energy Corridor concept emerged after a 2012 Power Grid Corporation of India Limited (PGCIL) study found inadequate transmission infrastructure near potential large-scale solar and wind sites.
  • PGCIL submitted its report in September 2012, states prepared transmission plans, and implementation began in 2015 after approvals.
• GEC Phase-I: The first phase focused on renewable-rich states and development of intra-state transmission infrastructure.
  • Phase-I covered eight States: Andhra Pradesh, Gujarat, Himachal Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan and Tamil Nadu, implemented through respective STUs.
  • GEC-I had an outlay of approximately ₹10,141.68 crore, with Central Financial Assistance of 40% of the DPR cost or awarded cost, whichever was lower. 
  • Phase-I successfully targeted the evacuation of approximately 24 GW of renewable energy. 
  • It constructed over 9,700 circuit kilometers (ckm) of transmission lines and 22,600 MVA of substation transformation capacity. 
  • It also established advanced Renewable Energy Management Centres (REMCs) for real-time forecasting and grid balancing.
• GEC Phase-II: GEC-II was approved by the CCEA in January 2022. It covers Gujarat, Himachal Pradesh, Karnataka, Kerala, Rajasthan, Tamil Nadu and Uttar Pradesh, targeting about 10,750 ckm transmission lines and 27,500 MVA transformation capacity.
  • Implementation is targeted by FY 2025-26.
  • GEC-II has a total project cost of ₹12,031.33 crore, including ₹3,970.34 crore CFA, equivalent to 33% of project cost. 
  • The remaining 67% is to be arranged by STUs, including access to loans from institutions such as IREDA, REC, PFC and KfW. 
  • Phase-II is set to integrate and evacuate an additional 20 GW of renewable energy. Its infrastructure targets include building 10,750 circuit kilometers (ckm) of transmission lines and 27,500 MVA of substation capacity. 
  • A separate inter-state GEC phase was also added to evacuate 13 GW of power from Ladakh.
• Current Progress: As of January 2026, the government stated that GEC-I and GEC-II together were intended for evacuation of 44 GW RE, of which approximately 26 GW had been integrated.
  • Transmission planning has subsequently expanded toward integrating 500+ GW non-fossil capacity by 2030 and 600+ GW by 2032.

India’s Clean Energy Transition

• Non-Fossil Capacity: India has set a target of 500 GW non-fossil capacity by 2030. By 31 July 2026, installed non-fossil capacity had reached 300.50 GW, accounting for more than 54% of total installed electricity-generation capacity. 
• Solar Energy Expansion: India reached a landmark 168 GW of installed solar capacity by late 2026. Mega utility-scale parks are driving this growth, alongside decentralised programs like the PM Surya Ghar scheme, which has already equipped over 50 lakh households with rooftop solar infrastructure.
  • PM-KUSUM addresses farm-energy needs through decentralised renewable plants, standalone solar pumps and grid-connected pump solarisation.
• Wind Power Optimization: The nation holds over 58 GW of wind capacity. The current strategy focuses on repowering legacy wind farms in high-potential coastal states like Gujarat and Tamil Nadu by replacing older turbines with modern, high-capacity versions.
• Green Hydrogen Economy: Under the National Green Hydrogen Mission, India has awarded over 8.6 lakh tonnes of annual production capacity. Policies now aggregate industrial demand by legally connecting green hydrogen developers with major buyers in the fertiliser and oil refining sectors.
• Domestic Green Manufacturing: To eliminate foreign import reliance, the Production-Linked Incentive (PLI) scheme expanded solar manufacturing capacity from 74 GW to 172 GW. Budget reforms also removed customs duties on raw materials needed for solar glass and lithium-ion cells.
  • Financial policies utilize Viability Gap Funding to make large-scale battery storage economically feasible for grid operators.
• Circular Bioenergy: India hit its E20 ethanol-blending target ahead of schedule. Through the GOBARdhan scheme, the government has registered over 1,900 compressed biogas (CBG) plants to transform agricultural waste and cattle dung into clean commercial fuel.
• Nuclear Energy Scale-up: Nuclear capacity stands at 8.78 GW, with a long-term goal of 100 GW by 2047. The government is funding the development of indigenous Small Modular Reactors (SMRs) and celebrated the first criticality of its Prototype Fast Breeder Reactor.

Major Government Initiatives Related to Green Energy

• The government has notified trajectories for Renewable Purchase Obligation (RPO) and Renewable Consumption Obligation (RCO) up to 2029-30, encouraging obligated entities to increase renewable-energy consumption.
• The Green Energy Open Access Rules, 2022 facilitate renewable-power procurement through open access. In addition, Green Day-Ahead Market (GDAM) and Green Term-Ahead Market (GTAM) provide exchange-based mechanisms for renewable electricity trading. 
• The government has introduced a Viability Gap Funding scheme for offshore wind, while separate storage-support mechanisms promote BESS deployment. 
• FAME India & PM E-DRIVE initiatives drive the quick adoption of electric vehicles (EVs) and public transit fleets. By funding robust EV charging infrastructure, they drastically reduce greenhouse gas emissions in cities.
• The Bureau of Energy Efficiency (BEE) leads extensive energy conservation campaigns. The landmark UJALA scheme distributed millions of cheap LED bulbs, drastically cutting down nationwide power consumption.
• The government permits up to 100% Foreign Direct Investment without prior approval in the green power market. This open-door policy draws vast private global capital to expand infrastructure rapidly.

Frequently Asked Questions (FAQs):

1. What is the Green Energy Corridor Phase-III Scheme?

GEC-III is a ₹1,86,405-crore scheme strengthening intra-state transmission and deploying 50 GWh BESS for renewable-energy integration. 

2. What is the main objective of Green Energy Corridor Phase-III?

Its main objective is enabling 135 GW renewable-energy evacuation, while improving grid flexibility, reducing congestion and managing renewable intermittency. 

3. How will the scheme support India’s 900 GW renewable energy goal?

GEC-III will expand transmission and storage infrastructure, enabling large-scale renewable integration required for India’s 900 GW non-fossil capacity target by 2035.

4. What is the target of Green Energy Corridor Phase-III?

GEC-III targets 135 GW renewable-energy evacuation and 50 GWh Battery Energy Storage Systems, with implementation targeted by FY 2032-33.

5. Why is renewable energy transmission infrastructure important?

It enables efficient power evacuation, reduces congestion and curtailment, improves grid stability, and connects renewable generation with demand centres.

Disclaimer: Information in this article is based on official announcements and public records. Details may evolve over time.

Also Read: India’s 155 GW Wind Energy Capacity Target by 2035