This Report had done a detailed analysis of estimating this financial implication using test cases of Tamil Nadu and Gujarat during the renewable-rich season in 2017. The Report recommends methods for sharing of balancing responsibility. The Report also recommends starting of ancillary services on permanent basis, in view of the increasing variable Renewable generation, and recommends policy and regulatory interventions required to deal with the increasing variable renewables to the Grid. The Report finds that even after including the financial implication on account of variable Renewable generation, it would still be cheaper in the future to set up renewable generation capacity, as compared to coal-based capacity. The health costs have been excluded. The Report also recommends setting up a MW Scale battery on pilot basis in the most wind-rich State of Tamil Nadu, to prevent curtailment on account of congestion/DSM Charges.