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Daily News Wrap-Up: APTEL Criticizes MERC for Denying Petitioner Relief


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					</table><p>The Central Electricity Regulatory Commission (<a href="https://cercind.gov.in/index.html" target="_blank" rel="noopener">CERC</a>) has ruled that the delay in adopting the tariff order by the <a href="https://uppcl.org/uppcl/hi/" target="_blank" rel="noopener">Uttar Pradesh Power Corporation</a> is a valid reason to claim an extension in the commissioning date for the generating station.</p>
<p>It also ordered the release of the performance bank guarantee (PBG) of ₹330 million (~$3.9 million) to wind developer <a href="http://www.mytrah.com/" target="_blank" rel="noopener">Mytrah Energy India</a>.</p>
<p><strong>Background </strong></p>
<p>Mytrah Vayu (Sabarmati), the petitioner, has a 250 MW wind power project in the Thoothukkudi district of Tamil Nadu.</p>
<p>The parent company, Mytrah Energy India, secured a successful bid in response to the October 28, 2016, 1,000 MW wind tender issued by the Solar Energy Corporation of India (<a href="https://www.seci.co.in/" target="_blank" rel="noopener">SECI</a>).</p>
<p><a href="https://www.ptcindia.com/" target="_blank" rel="noopener">PTC India</a> won the bid for the intermediary trading license on August 26, 2016.</p>
<p>Subsequently, Mytrah Energy established Mytrah Vayu (Sabarmati) as a special-purpose vehicle to implement the project.</p>
<p>Mytrah Vayu executed the power purchase agreement (PPA) on July 21, 2017.</p>
<p>According to the terms of the PPA, the entire 250 MW capacity was initially slated for commissioning by October 4, 2018. However, through its letter dated November 19, 2018, SECI revised the initial scheduled commercial operation date (SCOD) to November 13, 2018.</p>
<p>Subsequently, the petitioner commissioned 128.79 MW in the first Phase on January 29, 2019, 58.32 MW in the second Phase on April 15, 2019, and 62.89 MW in the third Phase on May 10, 2019, out of the contracted 250 MW capacity.</p>
<p>Mytrah contended that the delay in meeting the revised SCOD was attributed to force majeure events.</p>
<p>The company sought a direction against any coercive actions, including the encashment of the PBG.</p>
<p>The petitioner asserted that liquidated damages were not applicable due to the commissioning of the project within the stipulated timeframe and the absence of compensation claims from distribution companies.</p>
<p>It argued that SECI&#8217;s premature invocation of the PBG violated the PPA.</p>
<p>The petitioner contended that the delay in the SCOD extension approval adversely affected the project&#8217;s progress and bankability and led to cost overruns.</p>
<p>SECI contended that the petitioner experienced delays in meeting construction obligations, leading to a delay in achieving the SCOD as per the PPA. It asserted the right to encash the PBG for liquidated damages.</p>
<p>The nodal agency said the bidding documents and the PPA do not include any clause that prevented it from utilizing the PBG for liquidated damages.</p>
<p><strong>Commission’s Analysis </strong></p>
<p>The Commission had before it the following issues for adjudication:</p>
<ul>
<li>Whether unforeseen events constitute force majeure warranting a six-month extension of the SCOD. Also, if the delay caused by respondents in adopting the tariff justifies relief for the petitioner.</li>
<li>Whether SECI&#8217;s letter dated May 27, 2021, seeking to encash the petitioner&#8217;s PBG, should be set aside, and if SECI should release the guarantee to the petitioner.</li>
</ul>
<p>The Commission noted that the tender did not explicitly require tariff adoption for financial closure. It observed that Uttar Pradesh Power Corporation had delayed the tariff adoption and acknowledged Mytrah&#8217;s achievement of financial closure on September 20, 2017.</p>
<p>The Commission held that SECI&#8217;s delay in adopting the tariff contributed to the petitioner&#8217;s inability to schedule power, and hence, its penalty for project delay was unfair.</p>
<p>Recently, CERC <a href="https://www.mercomindia.com/cerc-approves-fatehgarh-transmission-project" target="_blank" rel="noopener">approved</a> an annual transmission charge of ₹248.67 million (~$2.98 million) as per the final offer by Apraava Energy to acquire Fatehgarh IV Transmission.</p>
<p>Subscribe to Mercom’s real-time <a href="https://mercomindia.com/product/mercoms-renewable-energy-regulatory-updates/" target="_blank" rel="noopener">Regulatory Updates </a>to ensure you don’t miss any critical updates from the renewable industry.</p>


CERC Upholds Wind Developer’s Plea for ₹330 Million Bank Guarantee Release


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					</table><p>The Competition Commission of India has approved the acquisition of 18 subsidiaries of renewable energy company <a href="https://www.mytrah.com/">Mytrah Energy</a> by JSW Neo Energy, a wholly-owned subsidiary of <a href="https://www.jsw.in/energy" target="_blank" rel="noopener">JSW Energy</a>.</p>
<p>The agreement presents an opportunity for JSW Neo Energy to acquire an operational portfolio of 1,753 MW.</p>
<p>JSW Neo Energy was incorporated as per JSW Energy’s reorganization of its energy business into grey (thermal) and green (renewable).</p>
<p>In May this year, JSW Group had <a href="https://mercomindia.com/jsw-acquire-mytrah-for-2-billion/" target="_blank" rel="noopener">signed</a> an agreement to buy renewable energy producer Mytrah Energy in a deal worth $1.8 billion to $2 billion.</p>
<p>Hyderabad-based Mytrah has over 1.8 GW of operational assets in the renewable energy sector. The assets are spread across 17 wind farms and 21 solar projects in nine states – Punjab, Rajasthan, Gujarat, Madhya Pradesh, Maharashtra, Karnataka, Telangana, Andhra Pradesh, and Tamil Nadu.</p>
<p>Last year, JSW Energy <a href="https://mercomindia.com/jsw-sustainability-renewable-energy-generation-roadmap/" target="_blank" rel="noopener">announced</a> plans to double its power generation portfolio with renewable and hydropower-based generation sources contributing to 70% of its total capacity in the medium term.</p>
<p>The company had said that it aimed to reduce its carbon footprint by 50% by 2030 and achieve carbon neutrality by 2050.</p>
<p>Earlier this year, JSW Neo Energy <a href="https://mercomindia.com/daily-news-wrap-up-jsw-pumped-hydro-storage-project/" target="_blank" rel="noopener">signed</a> a memorandum of understanding with the Telangana government to develop the Komoram Bheem Pump Storage Project in the state. It has tied up resources for 5 GW hydro pump storage projects with the governments of various states, including Maharashtra, Chhattisgarh, Telangana, and Rajasthan.</p>
<p>Last year, many acquisitions in the Indian renewable energy space grabbed the headlines. In one such transaction, Adani Green Energy <a href="https://mercomindia.com/adani-green-acquire-sb-energys-5-gw-renewable/" target="_blank" rel="noopener">signed</a> a share purchase agreement to acquire a 100% stake in SB Energy India from Soft Bank Group (80%) and Bharti Group (20%). The transaction marked the largest acquisition in the renewable energy sector in India.</p>
<p>In 1H 2022, globally, there were 53 solar mergers and acquisitions transactions compared to 54 transactions in 1H 2021. There were 148 project acquisitions for 38 GW of solar projects compared to 136 project acquisitions of 40 GW in 1H 2021, according to Mercom’s <a href="https://mercomcapital.com/product/1h-q2-2022-solar-funding-ma-report/" target="_blank" rel="noopener">1H and Q2 2022 Solar Funding and M&amp;A Report</a>.</p>


Competition Commission Approves JSW’s Acquisition of Mytrah Energy Subsidiaries


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					</table><p><a href="https://www.jsw.in/" target="_blank" rel="noopener">JSW Steel</a> has earmarked ₹100 billion (~$1.26 billion) for investments to reduce carbon emissions with targeted initiatives, including increasing the use of renewable energy to replace thermal power.</p>
<p>JSW Steel has entered into 25-year power purchase agreements with special purpose vehicles (SPVs) set up by JSW Energy to procure renewable energy through the group captive model. JSW Steel will acquire a 26% stake in each of those SPVs, which will set up renewable power facilities with an aggregate capacity of 958 MW, of which 225 MW was <a href="https://mercomindia.com/daily-news-wrap-up-jsw-commissions-solar-project/" target="_blank" rel="noopener">commissioned</a> in April 2022.</p>
<p>The facts were revealed in the company&#8217;s Annual Report 2021-22.</p>
<p>In FY 2021-22, JSW Steel became the first steel company globally to issue $500 million (~₹39.36 billion) sustainability-linked bonds.</p>
<p>The company raised a $1 billion (~₹78.71 billion) bond in two tranches of $500 million (~₹39.36 billion) each, with tenures of 5.5 years and 10.5 years. The 10.5-year tranche was linked to the company&#8217;s greenhouse gas emission target.</p>
<p>JSW Steel said that new steel grades were developed during the year in response to the dual needs of import substitution and specialized sectoral demand. These include a high permeability grade suitable for wind generators with higher energy efficiency. The grade will also help substitute imports and support the Government of India&#8217;s initiative of rapid growth in clean, renewable energy.</p>
<p>For the first time, a few high-strength low alloy (HSLA) grades have been developed for making torque tubes for Indian and export markets to address the needs of solar trackers. Major global solar players have approved these HSLA grades for their installations.</p>
<p>The company has developed a climate action plan to improve its carbon emission intensity and achieve more than a 42% reduction by 2030 from the base year of 2005.</p>
<p>The company had set a target of consuming around ~1,000 MW of renewable energy by 2030, and it is progressing steadily towards achieving the same.</p>
<p>In the FY 2021-22, JSW Steel has supplied steel to 9.1 GW of solar projects and 620 MW of wind projects.</p>
<p>JSW started utilizing solar power by <a href="https://mercomindia.com/daily-news-wrap-up-jsw-commissions-solar-project/" target="_blank" rel="noopener">commissioning</a> 225 MW of solar power at Vijayanagar by JSW Renewable Energy Vijayanagar, a subsidiary of JSW Energy Limited. JSW Steel Vijayanagar is currently utilizing solar power for its operation, resulting in reduced steam coal consumption.</p>
<p>In May this year, the JSW Group <a href="https://mercomindia.com/jsw-acquire-mytrah-for-2-billion/" target="_blank" rel="noopener">signed</a> an agreement to buy renewable energy producer Mytrah Energy in a deal expected to be worth $1.8 billion (~₹141.68 billion) to $2 billion (~$157.42 billion), according to Mercom sources.</p>


JSW Steel to Invest ₹100 Billion to Reduce Carbon Emissions

<p><a href="http://www.mytrah.com/mytrah-energy.php" target="_blank" rel="noopener">Mytrah Energy</a>, a renewable energy independent power producer (IPP), has successfully commissioned three solar projects in the state of Karnataka.</p>
<p>Each of the three projects have a capacity of 15 MW and are located in the Karnataka towns of Raibag, Hungund, and Sindagi.</p>
<p>Confirming the development, Mercom&#8217;s source at Mytrah Energy said, “The Raibag project was commissioned at the end of January 2018, while the other two projects were commissioned last month (February 2018).”</p>
<p>Mytrah won a bid to develop the projects by quoting an average tariff of ₹5.5 (~$0.08)/kWh. The projects were implemented under Phase V of the Karnataka state policy under the general category.</p>
<p>Bangalore Electricity Supply Company (BESCOM) is the off-taker for the power produced by the Sindagi project while Hubli Electricity Supply Company (HESCOM) and Gulbarga Electricity Supply Company (GESCOM) are the respective off-takers for the Hungund and Raibag projects.</p>
<p><a href="https://mercomindia.com/product/india-solar-project-tracker/" target="_blank" rel="noopener">Mercom’s India Solar Project Tracker</a> shows that Mytrah has a 422 MW solar portfolio, including 242 MW of operational projects and another 180 MW of projects nearing completion.</p>
<p>According to Mercom’s <a href="https://mercomindia.com/product/solarinstallations-q4-2017/" target="_blank" rel="noopener">2017 Q4 and Annual India Solar Quarterly Market Update</a>, Telangana and Karnataka together accounted for approximately 1.6 GW of installations in India during the fourth quarter of 2017.</p>
<p>Recently, domestic renewable energy project developer <a href="http://www.suzlon.com/" target="_blank" rel="noopener">Suzlon</a> also <a href="https://mercomindia.com/suzlon-340mw-solar-commissioned/" target="_blank" rel="noopener">commissioned</a> 340 MW of solar photovoltaic (PV) projects across the states of Maharashtra, Telangana, and Rajasthan.</p>
<p>Mercom previously <a href="https://mercomindia.com/indian-solar-installations-market-update/" target="_blank" rel="noopener">reported</a> that solar installations across India rose exponentially during the calendar year 2017, with the addition of 9,629 MW in new large-scale and rooftop solar capacity.</p>
<p>However, policy uncertainties surrounding the proposed <a href="https://mercomindia.com/dgad-70-percent-safeguard-imported-solar-cells/" target="_blank" rel="noopener">safeguard</a> and anti-dumping duties are testing the will of foreign companies to invest in the Indian solar sector. The lack of regulatory clarity has Mercom <a href="https://mercomindia.com/indian-solar-installations-market-update/" target="_blank" rel="noopener">forecasting</a> that Indian solar installations will decline in 2018 compared to 2017.</p>
<p>Image credit: MMEPL Solar</p>


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