Karnataka Electricity Regulatory Commission (KERC) has approved the group captive status of a 38 MW wind power project for Four EF Renewables, a special purpose vehicle of Ampyr Energy. The petitioner can claim group captive status from May 24, 2021.

The petitioner is entitled to a banking facility from August 24, 2021, confirmed by a supplemental agreement on May 23, 2022.

However, KERC ruled that Four EF Renewables will not be entitled to compensation for power injected without open access from December 6, 2020, to February 23, 2021.

Background

Four EF Renewables filed a petition under the Electricity Act, 2003, with Regulations 21 of the KERC (General and Conduct of Proceedings) Regulations, 2000, requesting the respondents to refund 300 lapsed units generated and wheeled into the respondents’ grid system between December 6, 2020, and February 28, 2021.

They also sought a credit of 2% of energy per month from the date of the denial until the actual crediting of energy.

Four EF Renewables mentioned that it has already paid 0.5% of the quantified amount, totaling ₹114,376 (~$1,375), as a court fee.

The petitioner requested the respondents to refund the excess tariff collected, considering the injected energy into the grid as utilized energy and a 2% interest per month from the date of the denial until the actual payment.

The four respondents were Bangalore Electricity Supply BESCOM, Mangalore Electricity Supply MESCOM, Karnataka Power Transmission Corporation KPTCL and State Load Dispatch Centre, Karnataka (SLDC).

Four EF Renewables argued that Article 10.1 of the agreement mandates Wheeling and Banking Agreement (WBA) from February 23, 2021, making respondents contractually obligated for the banking facility from that date.

Section 9 of the Electricity Act grants every generating project the right to captive usage, safeguarded by wheeling and banking facilities. The petitioner also asserted discriminatory treatment, noting similar WBAs granted to other companies.

The respondents claimed the petitioner concealed facts, such as an agreement to supply power to third-party consumers and an affidavit agreeing to execute a wheeling agreement.

They also accused the petitioner of injecting power into the grid before the wheeling agreement’s execution, endangering the grid. They also claimed that banking facility is not an inherent right.

The respondents highlighted the discrepancies in the petitioner’s claim of establishing a group captive power project.

They said there was no obligation to pay the petitioner since the power injection was not pursuant to any agreement.

The respondents said no wheeling and banking agreement was executed during the disputed period and that the petitioner was not entitled to carry forward units of energy.

The petitioner’s claim of entitlement to banking from February 23, 2021, does not hold because the executed wheeling agreement does not grant any banking rights.

KPTCL and SLCD also asserted that the petitioner is not entitled to any relief, including interim relief.

Commission’s Analysis

The Commission ruled that the petitioner’s power project cannot be deemed a captive power plant from its commissioning date on December 7, 2020.

The petitioner explicitly expressed its initial intention to supply power under third-party open access, only later seeking approval for conversion to a group captive power plant.

Therefore, group captive status can be granted only from the date of the government order on May 24, 2021.

Regarding banking facility entitlement, the regulator said the Electricity Act does not define banking, but various state electricity regulatory commissions have extended banking as a promotional measure. However, banking is not a right under the Act.

By providing an affidavit on December 7, 2020, the petitioner voluntarily relinquished its claim to banking by agreeing to wheeling without banking.

The Commission said Four EF Renewables is, however, entitled to banking from August 24, 2021, following the approval received from the government, as affirmed through a supplemental agreement on May 23, 2022.

It ruled that per the KERC (Terms and Conditions for Open Access) Regulations, 2004, the respondents are not obligated to compensate for energy injected without granting open access.

Therefore, the petitioner was deemed not entitled to any refund or compensation for power injected into the grid from December 6, 2020, to February 28, 2021.

The Commission directed the parties to settle any payable amounts within two months based on available records. Failure to do so will incur a 10% interest on the due amount from the date of this order.

In June, KERC clarified various rules in the state’s Terms and Conditions for Green Energy Open Access Regulations 2022.

Recently, KERC approved an additional surcharge of ₹1.40 /kWh (~$0.017) for consumers availing power through open access for the financial year 2023-24.

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