The Rajasthan Electricity Regulatory Commission (RERC) has allowed a solar developer to claim up to ₹488 million (~$5.5 million) in compensation due to a change-in-law event.

The Commission has allowed petitioner ACME Aklera Power Technology (ACME Solar Holdings) to claim compensation of ₹309.7 million (~$3.5 million) to ₹ 399 million (~$4.5 million) for the imposition of basic customs duty (BCD), and ₹89 million for the increase in goods and services (GST) tax.

It, however, rejected the petitioner’s claims for compensation for high-sea sales in non-Manufacturing and Other Operations in Warehouse Regulations (MOOWR) areas, amounting to ₹60.6 million (~$684,071). It also rejected the petitioner’s claim for margins on EPC invoices, vendor invoices raised before September 2021, and on credit notes issued, amounting to ₹17.6 million (~$684,071).

ACME will be allowed to claim the carrying cost from the date on which payments were made to the issuance of this order, without interest.

The respondents, SECI and Rajasthan Urja Vikas and IT Service, will have to pay a late payment surcharge for every day the payment is delayed.

Background

The Solar Energy Corporation of India (SECI) floated a tender to procure 750 MW from grid-connected solar projects.

ACME was awarded 250 MW under the tender, and SECI issued the letter of intent in 2019.

ACME signed a power purchase agreement (PPA) with SECI, and commissioned 200 MW in 2023 and 50 MW in 2024.

However, the petitioner said that the government increased the GST rate on renewable energy devices and their components from 5% to 12%. The Ministry of New and Renewable Energy also issued an office memorandum proposing to levy a BCD up to 40% on solar modules and 25% on solar cells from 2022.

The petitioner approached the Commission to consider the imposition of BCD and the increase in GST rates as a change-in-law event, and requested compensation for the losses suffered as a result of these changes.

Commission’s Analysis

The Commission said that under Article 12 of the PPA, an increase in the rates of BCD on the import of inverters, the levy of BCD on the import of solar modules and solar cells, along with a subsequent increase in the social welfare surcharge and IGST, and a rise in GST, qualifies as a change-in-law event.

It noted that the petitioner had submitted that it had suffered financial impacts of ₹112.6 million (~$1.3 million) due to the increase in the GST rate and ₹392 million (~$4.4 million) due to the BCD levy on solar modules and cells.

The respondents agreed to pay compensation of up to ₹309.7 million (~$3.5 million) for BCD and ₹89 million (~$1 million) for GST, totaling ₹399 million.

However, the disputed amount of ₹78 million (~$880,487) included the high-sea sale transaction, GST on margins included in EPC invoices, vendor invoices dated before September 30, 2021, and credit notes issued.

The Commission observed that high-seas sales transactions were used in non-MOOWR areas and, hence, rejected the petitioner’s request to claim compensation for the same.

However, the Commission ruled that the petitioner may claim the carrying cost from the date on which payments were made to the date of issuance of this order.

The rate of carrying cost will be the lower of the actual interest rate paid by the petitioner for arranging funds, the rate of interest on working capital as per RERC tariff regulations for the control period, or the late payment surcharge rate mentioned in the PPA.

In September 2025, RERC approved Jodhpur Vidyut Vitran Nigam’s tariffs ranging from ₹2.68 (~$0.030)/kWh to ₹3.66 (~$0.041)/kWh for solar projects with a cumulative capacity of 488 MW to be set up across Rajasthan under Component – C of the Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan program.

Subscribe to Mercom’s real-time Regulatory Updates to ensure you don’t miss any critical updates from the renewable industry.