The Appellate Tribunal for Electricity (APTEL) has put a stay order on the implementation of Andhra Pradesh Southern Power Distribution Company (APSPDCL)’s letter seeking a revision in the power purchase agreement (PPA) for a grid-connected solar photovoltaic (PV) project executed by SEI Green Flash Private Limited, SEI Aroshi and SEI Rain Coke, which are special purpose vehicles of developer Greenko. These projects were executed during the term of previous state government led by Chandrababu Naidu.
Mercom reported previously that SEI Green Flash Private Limited had requested the APTEL to intervene and put a stay on the operation of a letter dated July 12, 2019, issued to it by the APSPDCL regarding the revision of the tariff for its grid-connected solar PV project to ₹2.44 (~$0.036)/kWh.
The distribution company (DISCOM) had issued letters to SEI Green Flash Private Limited, SEI Aroshi and SEI Rain Coke stating that tariff should be revised to ₹2.44 (~$0.036)/kWh from the approved ₹3.74 (~$0.054)/kWh.
In its order, APTEL noted that the SPVs have not been given any opportunity of being heard provided to the appellant (SEI Green Flash Private Limited, SEI Aroshi and SEI Rain Coke), and therefore, the consequences mentioned in the letter have to be stayed until further orders.
APTEL has also directed the DISCOM to pay the tariff at the approved rate of ₹3.74 (~$0.054)/kWh until the next date of hearing. The APTEL has asked the matter to be listed on August 26, 2019.
Though this case is slightly different as the matter concerning Greenko’s special purpose vehicles was already sub-judice (APTEL had been approached by the SPV prior to the issuance of this letter), nevertheless it is a silver lining for other entities that have entered PPAs and power sale agreements (PSAs) with APSPDCL, and other Andhra Pradesh DISCOMs for solar PV.
Mercom previously reported that APSPDCL also wrote to the Solar Energy Corporation of India (SECI) and the National Thermal Power Corporation (NTPC) asking for a revision of tariff in the PPA and PSA to ₹2.44 (~$0.036)/kWh.
Mercom also reported that the Andhra Pradesh government recently issued a communique stating that during 2014-2019, several PPAs were signed more than the mandated 5% Renewable Power Purchase Obligation (RPPO), for up to 23% and the tariffs for these projects were high. The current state government has argued that the purchase beyond RPPO led to a loss of ₹10 billion ($146 million) to ₹15 billion ($219 million), due to the ensuing backdown costs of thermal power.
The state has been in the news since its chief minister Jaganmohan Reddy announced that all such PPAs and PSAs for solar and wind projects which were signed during the previous government’s rule will be renegotiated on charges of corruption.
Image credit: Gensol Group
Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.