Tie Up with At Least Three Manufacturers Before Bidding_ Gujarat Tells Wind Developers

The Maharashtra Electricity Regulatory Commission (MERC) has directed the Maharashtra State Electricity Distribution Company Limited (MSEDCL) to pay the dues to Kamal Encon Industries Limited (formerly KEC Industries Ltd) for the supply of electricity from its 1.65 MW wind power project located in the state’s Dhule district.

Kamal Encon Industries Limited had petitioned the MERC to direct MSEDCL to pay the entire outstanding amount towards the sales invoices due from July to October 2018. The total sum is ₹9,328,226 (~$134,919).

Kamal Encon Industries Limited had also requested the commission to direct MSEDCL to pay the carrying cost at the rate of 18 percent per annum of the delay in payment of the late payment surcharge in all future payments and expedite the process of approval for short-term power purchase agreement and to issue all the pending credit notes immediately.

Kamal Encon Industries Limited had also petitioned that the Maharashtra commission award ₹200,000(~$2,892.70) to it as the cost of these proceedings against MSEDCL.

While examining the petition, the Commission observed, “Kamal Encon Industries Limited and other wind generators in the past had approached it for prolonged non-payment and/or late payment of principal amounts for the supply of energy as well as the delayed payment charges (DPC) for such delayed payments by MSEDCL under the wind energy purchase agreements for projects.”

In January 2019, the MERC had issued a common order asking MSEDCL to release the agreed payments to the developers towards the principal amount and the interest on the principal amount as per the plan submitted to the commission.

After hearing the arguments, the commission has once again directed the parties to sit together and reconcile the statement of account within two weeks from the date of this order.

In its order, the Maharashtra commission also added that at the time of reconciliation, MSEDCL would have to inform Kamal Encon Industries Limited the exact time limit in which the payment will be made for the outstanding dues of principal and DPC amount.

Moreover, it has warned MSEDCL that if it deviates from its commitment, interest will be payable at 1.25 percent per month on any late payments.

This Maharashtra ruling is similar to an earlier order in which the MERC directed MSEDCL to pay dues to wind power generators Shah Lulla Estate Developers and BLP Wind Project (Amberi) Private Limited.

In October 2018, the commission had directed the MSEDCL to pay ₹41.05 billion (~$0.56 billion) in dues to wind power generators in Maharashtra.

Saumy Prateek 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.