The ongoing legal case between Adani Green Energy and the Tamil Nadu Electricity Regulatory Commission (TNERC), which will decide the final tariff rate for Adani’s solar project in the state, took another turn with the regulatory commission asking the company to file their plea as a Dispute Resolution Petition. Adani completed a 648 MW solar project in Tamil Nadu at a cost of $679 million (~Rs.45.6 billion) earlier this year. Mercom has reported that 360 MW of the 648 MW had been commissioned in March of 2016 while the remaining 288 MW was delayed due to evacuation issues.

Adani completed the final 288 MW through two of its subsidiaries, Kamuthi Solar Power and Ramnad Renewable Energy, which commissioned 216 MW and 72 MW respectively. These companies filed pleas with TNERC, stating that the cyclone and extensive rainfall in the region caused considerable damage resulting in delays to project construction. According to the company, the 216 MW project was completed by March 15, 2016 and the 72 MW project was completed by March 22, 2016. However, the sub-stations required for power evacuation from Tamil Nadu Generation and Distribution Corporation (TANGEDCO) were not provided, which further delayed their commissioning beyond March 31, 2016.

Solar projects in Tami Nadu which were commissioned before March 31, 2016, were to receive a tariff of Rs.7.01 (~$0.1045)/kWh. TANGEDCO reduced the tariffs for solar projects commissioned beyond this deadline to Rs.5.1 (~$0.076)/unit.

According to Mercom’s sources at Adani, due to this delay caused by TANGEDCO, the company will not get the Rs.7.01 (~$0.1045)/kWh tariff. Adani invested a total of Rs.18.08 billion (~$265.07 million) in these projects expecting a higher tariff, but had to settle for the state directed rate of Rs.5.1 (~$0.076)/unit, which drastically reduced their returns.

The Adani source stated that TNERC has rejected Adani’s initial legal case and confirmed that Kamuthi Solar Power and Ramnad Renewable Energy have filed pleas as a Dispute Resolution Petition. The case now rests at the tribunal.

Mercom has reported on curtailment issues affecting solar power in India, especially in the states of Tamil Nadu and Rajasthan, which has created a tough situation for developers.