Deviation settlement mechanism (DSM) and its impact To maintain grid stability, forecasting and scheduling renewable energy is crucial due to its intermittent nature. Since 2017, state electricity regulatory commissions have implemented the Deviation Settlement Mechanism (DSM) to penalize developers for deviations beyond a certain threshold (typically +/- 15%) from their forecasted generation. visit https://www.ceew.in/cef/quick-reads/explains/deviation-settlement-mechanism-dsm-and-its-impact