In a decisive move to position Odisha as a leading destination for clean energy investments, the State Cabinet, chaired by Chief Minister Mohan Charan Majhi, today approved two major proposals from the Energy Department.
The decisions focus on amending the Odisha Renewable Energy Policy (OREP), 2022, and updating the Odisha Pumped Storage Projects (PSP) Policy, 2025, along with its operational guidelines.
These reforms aim to accelerate renewable energy deployment, strengthen investor confidence, and ensure affordable green power for consumers while supporting the state’s ambitious target of adding approximately 11,000 MW of renewable capacity by 2030.
Key Amendments to Odisha Renewable Energy Policy, 2022
The Cabinet cleared several refinements to the OREP 2022, based on implementation experience and stakeholder feedback:
- Extension of electricity duty exemption at 50 paise per unit for eligible net-metering consumers on energy from renewable projects set up within the state, for a period of 10 years from the date of commissioning.
- 20 paise per unit State Transmission Utility (STU) charge exemption for standalone Battery Energy Storage Systems (BESS), provided the input energy is sourced from renewable projects and the output meets the state’s demand.
- Rationalisation of the wind power project allocation framework by removing the existing cumulative cap of 500 MW under the first-come, first-served mechanism.
- Promotion of dedicated Wind Power Parks.
- Right of first refusal (RoFR) of up to 25% of capacity for renewable energy captive projects.
- Harmonisation of operational guidelines.
- Designation of GRIDCO as the Nodal Agency for implementing legacy Small Hydro Electric Projects (SHEP).
Officials said these changes will significantly improve operational efficiency and give a strong push to renewable energy development across the state.
Boost for Pumped Storage Projects
The Cabinet also approved amendments to the Odisha Pumped Storage Projects Policy, 2025, and its operational guidelines. The updated policy will remain in force until 31 March 2030.
Pumped storage projects are recognised as a critical tool for energy transition. They store surplus electricity during off-peak hours and release it during peak demand or periods of low renewable generation, offering the most economical long-duration energy storage solution currently available. These projects also provide grid stability benefits such as instantaneous response to load variations, black-start capability, spinning reserves, and frequency regulation.
To encourage development, the policy offers a comprehensive package of incentives, including:
- Infrastructure support
- Exemption from electricity duty, cross-subsidy surcharge, wheeling charges, and STU charges
- No water cess
- Provision of free power
- Local Area Development Fund (LADF) benefits
A Strong Signal to Investors
The dual approvals send a clear message that Odisha is serious about creating a conducive ecosystem for renewable energy and energy storage. By removing bottlenecks in wind project allocation, incentivising battery storage, and offering attractive terms for pumped hydro, the state is aligning its policies with national energy transition goals while prioritising consumer affordability and grid reliability.
