The Appellate Tribunal for Electricity (APTEL) has quashed an order issued by the Madhya Pradesh Electricity Regulatory Commission (MPERC), which reduced the tariff for a 50 MW wind project from ₹5.92 (~$0.068)/kWh to ₹4.78 (~$0.055)/kWh citing commissioning delay.

APTEL ruled that the developer is eligible for a tariff of ₹5.92 (~$0.068)/kWh from the date of electricity supply into the grid.

The Tribunal also directed Madhya Pradesh State Power Transmission Company to make the required payments and carrying costs at the late payment surcharge (LPS) rate within three months of the judgment.

Background

The appellant, Orange Bercha Wind Power, developed a 50 MW wind project in Madhya Pradesh. The project was expected to be commissioned by March 31, 2016, at a tariff of ₹5.92 (~$0.068)/kWh. However, the commissioning was delayed until May 5, 2016, due to delays in obtaining necessary approvals. Consequently, MPERC ruled that the project fell under the revised tariff order, which reduced the applicable tariff to ₹4.78 (~$0.055)/kWh.

Orange Bercha contended that the delays in commissioning were caused by Madhya Pradesh Power Transmission Company and Madhya Pradesh State Load Dispatch Centre, which failed to grant charging permission and establish a working telemetry data system on time. It argued that these delays were beyond its control and should not affect its eligibility for the higher tariff.

The respondents, including MPERC and Madhya Pradesh Power Transmission Company, argued that the project was commissioned after March 31, 2016, making it ineligible for the ₹5.92 (~$0.068)/kWh tariff. They maintained that Orange Bercha had agreed to the lower tariff while executing the Power Purchase Agreement (PPA).

Tribunal’s Analysis

APTEL observed that Orange Bercha had completed all requirements for commissioning by March 31, 2016. It held that the delays were attributable to Madhya Pradesh Power Transmission Company and Madhya Pradesh State Load Dispatch Centre, which failed to provide timely approvals.

The Tribunal cited previous rulings, where it was determined that delays caused by state authorities should not be held against project developers.

APTEL ruled that the appellant was entitled to the original tariff of ₹5.92 (~$0.068)/kWh. It dismissed the respondents’ argument that Orange Bercha had waived its claim by signing the PPA at a lower rate, citing legal precedents that prevent a party from benefiting from its own delays or wrongful actions.

The Tribunal set aside MPERC’s order and directed the Madhya Pradesh Power Transmission Company to compensate the appellant at the higher tariff rate and applicable carrying costs at the LPS rate within three months.

In December last year, APTEL  affirmed the rights of power generators to terminate their PPAs with the Southern Power Distribution Company of Andhra Pradesh due to persistent defaults on payment obligations.

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