The Andhra Pradesh Electricity Regulatory Commission has directed the Transmission Corporation of Andhra Pradesh (APTRANSCO) to refund the Operation and Maintenance (O&M) charges amounting to ₹4.8 million (~$55,954) to Aurobindo Pharma.

The charges were levied on the petitioner for the O&M activities carried out by APTRANSCO on two transmission projects until the projects’ handover.

The Commission ordered the refund of O&M charges, stating that APTRANSCO owns the transmission line and must pay for the maintenance charges. Additionally, it added that the petitioner also pays for operational maintenance under the retail supply tariff.

The Commission, however, rejected Aurobindo’s plea for APTRANSCO to refund the interest paid by the petitioner.

Background

The petitioner, Aurobindo Pharma, entered into a long-term open access agreement with Andhra Pradesh Eastern Power Distribution Company (APEPDCL) for electricity supply for a contracted maximum demand of 12,000 kVA.

The company constructed the 132 kV supply line connecting the Pydibheemavaram substation with its unit and bay at the substation with APTRANSCO’s approval.

To prevent project delay, Aurobindo paid supervision charges of ₹5.48 million (~$63,880) and constructed the project on behalf of APTRANSCO. It also incurred 54.82 million (~$639,042) toward establishing the transmission line and metering yard.

The transmission project was commissioned and handed over to APTRANSCO.

However, APTRANSCO asked Aurobindo to pay annual maintenance charges of ₹4.6 million (~$53,622) for the interconnection facilities from the project commissioning date until 2022.

The petitioner also has 30 MW solar captive projects at Varisam in Srikakulam district, and it had built a high-temperature superconductor transmission line to evacuate power from the project.

The interconnection with APEPDCL for the solar power project was completed on a turnkey basis under the supervision of APTRANSCO. The line and bays associated with the project were commissioned in 2017 and handed over in 2023.

The power from the solar power project is injected into the grid substation at 132/33 kV Pydibheemavaram. The petitioner maintained the 132 kV line and stainless-steel equipment since the commencement of the project.

APTRANSO demanded payment of annual maintenance expenses amounting to ₹236,959 (~$2,762) for providing interconnection facilities for nearly a year after commissioning the project.

The petitioner added that APTRANSCO refused to renew the long-term open access agreement and was forced to pay the O&M charges.

However, APTRANSCO argued that it has levied O&M charges for activities carried out between 2011 and 2023, when the transmission projects were under the company.

Additionally, tAPTRANSCO argued that O&M charges for the transmission project connected to the solar project were levied for the period before the takeover of the assets. It highlighted that the petitioner failed to hand over the project immediately after project commissioning, resulting in APTRANSCO having to incur third-party O&M expenses.

The petitioner approached the Commission to seek a cumulative refund of ₹4.8 million (~$55,954) along with compensation of 12% interest on the refund amount.

Aurobindo also asked the Commission to order APTRANSCO not to levy such changes in the future.

Commission’s Analysis

The Commission observed that the transmission line will be the APTRANSCO’s property and must maintain it at their own cost. It added that maintenance charges are included in the electricity tariff.

It also observed that APTRANSCO has not submitted any statutory document showing that the petitioner must pay O&M charges in case of non-transfer of assets.

The Commission said  APTRANSCO unlawfully collected O&M charges and ordered a refund within a month.

However, the Commission refused to direct APTRANSCO to issue 12% interest on O&M charges collected to Aurobindo.

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