The Appellate Tribunal for Electricity (APTEL) has ruled in favor of a solar power developer, extending the scheduled commercial operation date (SCOD) of its two solar projects in Rajasthan with a capacity of 70 MW each and directing NTPC to refund ₹70.6 million (~$812,500) collected as liquidated damages.

The tribunal found that delays in transmission infrastructure beyond the developer’s control justified the SCOD extension to August 11, 2017.

Background

The appellant, Solaire Surya Urja, had won a bid under the National Solar Mission guidelines to set up two solar projects with a capacity of 70 MW each. It signed two power purchase agreements (PPA) with NTPC to sell power from its projects in Bhadla Solar Park Phase II. Under the PPAs, the SCOD was set for June 1, 2017.

However, the appellant faced delays due to Rajasthan Rajya Vidyut Prasaran Nigam’s (RRVPNL) failure to provide the full power evacuation permitted on August 24, 2017, forcing Solaire Surya Urja to commission the projects in stages.

NTPC, citing non-compliance with the SCOD, levied liquidated damages per the PPA, leading the petitioner to challenge the penalties before the Central Electricity Regulatory Commission (CERC), which ruled in NTPC’s favor.

Solaire Surya approached APTEL, arguing that the delay was beyond its control, as RRVPNL had not completed the required transmission network on time. It cited clauses in the PPAs that allowed for SCOD extensions in cases where transmission delays were attributed to external agencies.

The company contended that NTPC had unfairly collected ₹70.6 million (~$812,500) in liquidated damages despite being aware of the evacuation infrastructure unavailability.

The respondents, including NTPC and RRVPNL, countered that the responsibility for ensuring grid connectivity rested with the appellant. They argued that NTPC had the contractual right to impose penalties for failure to meet the SCOD.

Tribunal’s Analysis

APTEL ruled that RRVPNL’s failure to provide timely transmission infrastructure was a critical factor in the delay.

The Tribunal noted that the appellant had made all necessary preparations before the SCOD but could not supply power due to transmission constraints. It also acknowledged that Solaire Surya Urja was prevented from injecting power into the grid without RRVPNL’s approval.

The Tribunal directed the extension of the SCOD to August 11, 2017, aligning with the project’s full commissioning. It ordered NTPC to refund the ₹70.6 million (~$812,500) liquidated damages within one month.

Recently, APTEL set aside the Himachal Pradesh Electricity Regulatory Commission’s dismissal of a petition to determine the tariff for a solar project.

Earlier, APTEL dismissed an appeal by the Hubli Electricity Supply Company against an order of the Karnataka Electricity Regulatory Commission in 2021 granting a tariff increase for a solar project to compensate for higher costs due to changes in tax laws.

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