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					</table><p>The Maharashtra Electricity Regulatory Commission (<a href="https://merc.gov.in/" target="_blank" rel="noopener">MERC</a>) has directed the Maharashtra State Electricity Distribution Company (<a href="https://www.mahadiscom.in/en/home/" target="_blank" rel="noopener">MSEDCL</a>) to release the performance bank guarantees of solar developers ACME Sikar Solar and ReNew Dinkar Urja upon the termination of their power purchase agreements (PPA), failing the power evacuation set up by state entities.</p>
<p>The Commission held that the inability of the transmission company to ensure power evacuation constituted a force majeure event under the PPAs. As the force majeure had continued beyond 180 days, it ruled that the solar developers had validly terminated the PPAs.</p>
<p><strong>Background</strong></p>
<p>ACME Sikar Solar (ASSPL), a special purpose vehicle of ACME Solar Holdings (<a href="https://www.acmesolar.in/" target="_blank" rel="noopener">ASHPL</a>), submitted a petition on April 3, 2023, seeking a declaration regarding the termination of the PPA on account of force majeure and the return of the performance bank guarantee (PBG) of ₹240 million (~$2.89 million).</p>
<p>The respondent in this case is MSEDCL.</p>
<p>In a separate petition, ReNew Dinakar Urja (RDUPL), an SPV of <a href="https://www.renew.com/" target="_blank" rel="noopener">ReNew Solar Power</a>, sought the return of its PBG of ₹160 million (~$1.9 million).</p>
<p>The respondents in the case of ReNew were MSEDCL, MSETCL, and Central Transmission Utility of India (<a href="https://www.ctuil.in/" target="_blank" rel="noopener">CTU</a>).</p>
<p>ACME stated that the force majeure event that affected their ability to fulfill their obligations is attributed to MSETCL&#8217;s failure to provide an unconditional No Objection Certificate (NOC) for power evacuation from ASSPL&#8217;s 300 MW solar power project in Rajasthan to MSETCL&#8217;s network.</p>
<p>The necessity of an unconditional NOC arose because the power from the project is intended to flow from MSETCL&#8217;s network through the CTU’s Inter-State Transmission System (ISTS).</p>
<p>The unconditional NOC is a prerequisite for the CTU to grant unconditional long-term access (LTA) for power evacuation from ACME&#8217;s Rajasthan project up to MSETCL&#8217;s periphery and subsequently for the transmission and supply of power from MSETCL&#8217;s periphery to MSEDCL.</p>
<p>Due to MSETCL&#8217;s failure to issue the NOC, ACME said it was confronted with several issues that were beyond its control, and therefore, it terminated the PPA.</p>
<p>The petitioner submitted that it had the right to terminate the PPA if a force majeure event persists for a duration exceeding 180 days.</p>
<p>Similarly, ReNew stated the purpose of the PBG is to guarantee the punctual commissioning of the project, and upon successful commissioning, the PBG is meant to be returned.</p>
<p>The project&#8217;s foundation was laid on the assumption of a long-term evacuation arrangement being in place. According to the terms of the PPA, MSEDCL was obligated to procure power.</p>
<p>However, due to deficiencies in the STU network arising from the non-availability of a transmission corridor, uncertainty persisted in the power evacuation process.</p>
<p>MSEDCL, in its response, argued that the force majeure clause was applicable only to the extent that the circumstances were beyond the reasonable control of the affected party. It said the petitioners were responsible for selecting the project site and ensuring grid connectivity availability.</p>
<p>The STU stated that ACME and ReNew applied for a NOC in March and April 2022, respectively, seeking long-term access due to insufficient Available Transfer Capability (ATC) margin. It issued conditional NOCs in July 2022, contingent on network strengthening and ATC margin availability, requiring an indemnity bond.</p>
<p>The CTU granted ACME conditional LTA in June 2022 before STU&#8217;s conditional NOC issuance. However, ReNew’s NOC was delayed due to the pending indemnity bond submission.</p>
<p>STU emphasized that both the petitioners and MSEDCL failed to confirm ATC margin availability before finalizing the PPA.</p>
<p><strong>Commission’s Analysis </strong></p>
<p>The Commission noted that ACME secured a capacity of 300 MW and ReNew 200 MW through a competitive tariff-based bidding process.</p>
<p>The Commission acknowledged the diligence of the petitioners in pursuing the issuance of an unconditional NOC. However, MSEDCL and STU argued that the petitioners must demonstrate compliance with prudent utility practices before claiming force majeure.</p>
<p>MERC noted that MSEDCL&#8217;s solar tender did not specify the location but specified that the delivery was to be in Maharashtra. While developers install projects anywhere, the responsibility of grid upgrades for connection falls on CTU/STU and not developers.</p>
<p>The Commission determined that the inability of MSETCL to issue an unconditional NOC had created uncertainty in power evacuation, impacting the cash flow of the projects and causing lenders to withdraw support. This situation constituted a force majeure event under the PPA, and since it had continued beyond 180 days, the Commission ruled that the petitioners had validly terminated the PPAs.</p>
<p>As the PPAs were terminated, the Commission directed MSEDCL to return the respective bank guarantees to the petitioners within 15 days.</p>
<p>The Commission underscored the critical role of guaranteed power evacuation in securing project financing. In the absence of such assurances, including a defined compensation mechanism in case of grid-related non-evacuation, financial institutions remain hesitant to lend support, jeopardizing the projects&#8217; viability.</p>
<p>The Commission emphasized the unfortunate termination of a 500 MW solar PPA with a low tariff of ₹2.42 (~$0.0291) -2.43 (~$0.0292)/kWh and urged MSETCL/STU to expedite the implementation of transmission schemes to increase CTU-STU tie-line capacities.</p>
<p>Recently, MERC <a href="https://www.mercomindia.com/maharashtra-directs-discom-honor-solar-developers-bcd-gst" target="_blank" rel="noopener">directed</a> MSEDCL to compensate Juniper Green Field with ₹406.44 million ($4.92 million) for increased Basic Customs Duty on solar inverters and higher GST on renewable energy devices.</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>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/gautamee-hazarika/" class="vcard author" rel="author"><span class="fn">Gautamee Hazarika</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/10/Picture1.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Gautamee,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/gautamee-hazarika/" target="_blank" rel="noopener">More articles from Gautamee.</a><br />
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<a href="gautamee@mercomindia.com" target="_blank" rel="noopener">gautamee@mercomindia.com</a></p>
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<div class="authorboxn"><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/10/Picture1.jpg" width="102" height="102" /><a href="https://mercomindia.com/author/gautamee-hazarika/" rel="noopener">Gautamee</a> is a reporter at Mercom India. Prior to Mercom, Gautamee was working as a multimedia news journalist at ThePrint in New Delhi. She has received her Bachelors in English Honors and Masters in English Literature from St.Stephen&#8217;s College, University of Delhi.<a href="https://mercomindia.com/author/gautamee-hazarika/" rel="noopener">More articles from Gautamee</a></div>
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MERC Directs Bank Guarantees of Two Solar Developers to be Released


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					</table><p>The Karnataka Electricity Regulatory Commission (<a href="https://kerc.karnataka.gov.in/en" target="_blank" rel="noopener">KERC</a>) approved ₹70.6 million (~$849,791) compensation to Solitaire Powertech over the reported generation loss of 15,949 MWh for its 30 MW solar project, following the final estimations submitted by the Grid Controller of India (<a href="https://posoco.in/en/" target="_blank" rel="noopener">GCIL</a>).</p>
<p>Solitaire Powertech filed a petition seeking compensation for a generation loss of 28,242 MWh for their 30 MW solar project from August 2020 to September 2021.</p>
<p>The respondents in the case were Karnataka Power Transmission Corporation (<a href="https://kptcl.karnataka.gov.in/english" target="_blank" rel="noopener">KPTCL</a>) and Solar Energy Corporation of India (<a href="https://www.seci.co.in/" target="_blank" rel="noopener">SECI</a>).</p>
<p><strong>Background</strong></p>
<p>Solitaire Powertech first filed the petition for compensation with KERC in 2021. The Commission, in an order dated September 14, 2021, outlined that the petitioner is entitled to ₹4.43 (~$0.053)/kWh compensation for generation loss due to transmission congestion starting August 1, 2020. Monthly compensation calculations were to be submitted to the Commission and KPTCL within eight weeks.</p>
<p>The Commission said it would verify and determine a lump sum compensation payable by KPTCL within eight weeks, with a 6% per annum interest on default.</p>
<p>Following this order, KPTCL challenged it through a writ petition, and the petitioner contested the decision before the Appellate Tribunal for Electricity (<a href="https://aptel.gov.in/" target="_blank" rel="noopener">APTEL</a>), disputing the disallowed claim from the commercial operation date of April 7, 2018.</p>
<p>After the petition’s dismissal, KPTCL filed an appeal against the final order&#8217;s legality and was directed to approach its state commission and seek a third-party assessment.</p>
<p>After reviewing submissions, the Commission decided to refer the assessment of generation loss to an independent expert and chose the Grid Controller of India (<a href="https://www.posoco.in/" target="_blank" rel="noopener">GCIL</a>).</p>
<p>The Executive Director of Southern Regional Load Despatch Centre (SRLDC) at GCIL submitted a detailed curtailment report on June 15, 2023, quantifying a net generation loss of 15,949 MWh for the relevant period of the petitioner&#8217;s 30 MW solar project due to power evacuation curtailment.</p>
<p>Following the report submission, both the petitioner and KPTCL filed objections.</p>
<p>The petitioner challenged Grid India&#8217;s Curtailment Report, asserting errors in quantifying generation losses due to technology and location differences. It also argued against the comparison with Azure&#8217;s project, emphasizing the necessity of shutting down extra inverters for grid security.</p>
<p>The petitioner argued that the amount of energy produced by the petitioner&#8217;s project&#8217;s generating units has significantly decreased in the Curtailment Report, indicating an error of around 30%.</p>
<p>The report from Grid India explicitly stated that the petitioner had suffered a generation loss of at least 15,949 MWh, contrasting with the 28,242 MWh loss calculated in the TUV Rheinland Report.</p>
<p>The petitioner urged the rejection of Grid India&#8217;s Curtailment Report and acceptance of the 28,242 MWh generation loss computed in the TUV Rheinland Report.</p>
<p>KPTCL argued that no liability for damages exists due to the absence of a valid agreement pre-determining damages. Without a binding agreement on damages, KPTCL claimed that it could not be held responsible for hypothetically quantified losses.</p>
<p>It also added that the petition did not allege loss/damages based on tortious liability, so no relief could be granted on that ground. Therefore, it requested the dismissal of GCIL&#8217;s estimated loss and rejection of the petitioner&#8217;s claim for the above reasons.</p>
<p><strong>Commission Analysis </strong></p>
<p>The Commission analyzed the opposing arguments for the energy loss from August 2020 to September 2021.</p>
<p>It noted that the petitioner submitted an Energy Yield Estimation Analysis Report by TUV Rheinland, estimating a loss of 28,242 MWh. However, it raised concerns regarding the reliability of the TUV Rheinland software.</p>
<p>The Commission found the evidence insufficient to support the claimed energy loss.</p>
<p>In case the loss of generation at 15,949 MWh, as assessed by GRID India, is accepted or adjusted, the Commission said GRID India&#8217;s report estimated a generation loss of 15,949 MWh.</p>
<p>The Commission considered the methodology used and the objections raised by both parties. After assessing dissimilarities between projects and expert opinion from GCIL, the Commission affirmed the 15,949 MWh generation loss as calculated by GRID India.</p>
<p>The Commission rejected the petitioner&#8217;s request to true up the generation loss, considering the reasonableness of the estimate provided by GCIL.</p>
<p>Given the validated generation loss of 15,949 MWh, at a rate of ₹4.43(~$0.053)/kWh, the total compensation/damages payable to the petitioner is ₹70.6 million (~$849,791), i.e., 15,949 x 1,000 x 4.43(~$0.053) = ₹70,654,070 (~$849,791).</p>
<p>Recently, KERC <a href="https://www.mercomindia.com/karnataka-regulator-condones-project-commissioning" target="_blank" rel="noopener">condoned</a> the delay in the commissioning of solar power projects by a developer and allowed the extension of the scheduled commercial operation date.</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>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/gautamee-hazarika/" class="vcard author" rel="author"><span class="fn">Gautamee Hazarika</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/10/Picture1.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Gautamee,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/gautamee-hazarika/" target="_blank" rel="noopener">More articles from Gautamee.</a><br />
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<a href="gautamee@mercomindia.com" target="_blank" rel="noopener">gautamee@mercomindia.com</a></p>
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<div class="authorboxn"><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/10/Picture1.jpg" width="102" height="102" /><a href="https://mercomindia.com/author/gautamee-hazarika/" rel="noopener">Gautamee</a> is a reporter at Mercom India. Prior to Mercom, Gautamee was working as a multimedia news journalist at ThePrint in New Delhi. She has received her Bachelors in English Honors and Masters in English Literature from St.Stephen&#8217;s College, University of Delhi.<a href="https://mercomindia.com/author/gautamee-hazarika/" rel="noopener">More articles from Gautamee</a></div>
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KERC Greenlights ₹70.6 Million Compensation for Generation Loss to Developer


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					</table><p>Karnataka Electricity Regulatory Commission (<a href="https://kerc.karnataka.gov.in/en" target="_blank" rel="noopener">KERC</a>) has condoned the delay in the commissioning of solar power projects by a developer and allowed the extension of the scheduled commercial operation date (SCOD).</p>
<p>Consequently, a tariff of ₹8.40 (~$0.10)/kWh is allowed as agreed in the power purchase agreement (PPA).</p>
<p><strong>Background </strong></p>
<p>Jigajinagi Jagtap Solar Energy sought approval for a supplemental agreement dated April 21, 2017, which it entered into with Hubli Electricity Supply Company (<a href="https://hescom.karnataka.gov.in/english" target="_blank" rel="noopener">HESCOM</a>).</p>
<p>The respondents were HESCOM, <a href="https://energy.karnataka.gov.in/english" target="_blank" rel="noopener">Department of Energy</a>, Karnataka Renewable Energy Development (<a href="https://kredl.karnataka.gov.in/english" target="_blank" rel="noopener">KREDL</a>), and Karnataka Power Transmission Corporation (<a href="https://kptcl.karnataka.gov.in/english" target="_blank" rel="noopener">KPTCL</a>).</p>
<p>The petitioner wanted HESCOM to make payments for energy delivery at ₹8.40 (~$0.10)/kWh from the COD of its solar project throughout the term of the power purchase agreement (PPA).</p>
<p>PPAs were signed on July 13 and 14, 2015, and approved by the Commission on July 31, 2015.</p>
<p>On April 21, 2017, supplementary PPAs were entered into by the petitioners&#8217; special purpose vehicle (SPV) with HESCOM.</p>
<p>Due to delays in project commissioning beyond the SCOD, Jigajinagi Jagtap Solar Energy secured a six-month extension from HESCOMIn its petition, the developer urged HESCOM to adhere to the PPA terms and make payments at the agreed tariff of ₹8.40 (~$0.10)/kWh.</p>
<p>While HESCOM and KPTCL said they had no objection to the relief sought, KREDL asserted that it was not a party to the petition and sought dismissal of the petitions.</p>
<p>The Commission issued an order on November 22, 2018, ruling that the petitioners were entitled to a tariff of ₹4.36 (~$0.05)/kWh, applicable from the commissioning date of the project.</p>
<p>The solar developer was directed to fulfill payment obligations for damages and liquidated damages as per the PPA.</p>
<p>The petitioner approached the Appellate Tribunal for Electricity (<a href="https://aptel.gov.in/" target="_blank" rel="noopener">APTEL</a>), seeking that the case be remanded to the state commission for proper disposal.</p>
<p>APTEL accepted the request and remitted the case back to the state commission.</p>
<p><strong>Commission’s Analysis </strong></p>
<p>The Commission acknowledged the challenges in executing the project within the SCOD in the face of delays in obtaining permissions, approval of PPA and SPPA, demonetization, delays in power evacuation approvals, and safety approvals.</p>
<p>Consequently, the delay in commissioning the projects should be attributed to force majeure events, a fact acknowledged by the respondents in their communications and extensions approved by the Commission.</p>
<p>The Commission noted that the developer was entitled to a tariff of ₹8.40 (~$0.10)/kWh since the project was commissioned within the extended time granted by the respondents.</p>
<p>As per the generic tariff order, the approved tariff is applicable to solar power generators entering into PPAs between April 1, 2013 and March 31, 2018.</p>
<p>The Commission ruled that the solar developer petitioner is entitled to the tariff as per the PPA from the date of COD.</p>
<p>It also directed HESCOM not to levy liquidated damages, and if already levied, the same must be refunded to the petitioner within two months.</p>
<p>The Commission directed HESCOM to pay the differential tariff within 90 days,  failing which the petitioner is entitled to interest at 10%.</p>
<p>Recently, KERC <a href="https://www.mercomindia.com/karnataka-regulator-upholds-group-wind-project" target="_blank" rel="noopener">approved</a> the group captive status of a 38 MW wind power project for Four EF Renewables.</p>
<p>In June, KERC <a href="https://www.mercomindia.com/karnataka-clarifications-green-energy-open-access-rules" target="_blank" rel="noopener">clarified</a> various rules in the state’s Terms and Conditions for Green Energy Open Access Regulations 2022.</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>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/gautamee-hazarika/" class="vcard author" rel="author"><span class="fn">Gautamee Hazarika</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/10/Picture1.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Gautamee,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/gautamee-hazarika/" target="_blank" rel="noopener">More articles from Gautamee.</a><br />
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<a href="gautamee@mercomindia.com" target="_blank" rel="noopener">gautamee@mercomindia.com</a></p>
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<div class="authorboxn"><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/10/Picture1.jpg" width="102" height="102" /><a href="https://mercomindia.com/author/gautamee-hazarika/" rel="noopener">Gautamee</a> is a reporter at Mercom India. Prior to Mercom, Gautamee was working as a multimedia news journalist at ThePrint in New Delhi. She has received her Bachelors in English Honors and Masters in English Literature from St.Stephen&#8217;s College, University of Delhi.<a href="https://mercomindia.com/author/gautamee-hazarika/" rel="noopener">More articles from Gautamee</a></div>
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Karnataka Regulator Condones Delay in Solar Project Commissioning


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					</table><p>Karnataka Electricity Regulatory Commission (<a href="https://kerc.karnataka.gov.in/en" target="_blank" rel="noopener">KERC</a>) has approved the group captive status of a 38 MW wind power project for Four EF Renewables, a special purpose vehicle of <a href="https://www.ampyrenergy.com/" target="_blank" rel="noopener">Ampyr Energy</a>. The petitioner can claim group captive status from May 24, 2021.</p>
<p>The petitioner is entitled to a banking facility from August 24, 2021, confirmed by a supplemental agreement on May 23, 2022.</p>
<p>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.</p>
<p><strong>Background </strong></p>
<p>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&#8217; grid system between December 6, 2020, and February 28, 2021.</p>
<p>They also sought a credit of 2% of energy per month from the date of the denial until the actual crediting of energy.</p>
<p>Four EF Renewables mentioned that it has already paid 0.5% of the quantified amount, totaling ₹114,376 (~$1,375), as a court fee.</p>
<p>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.</p>
<p>The four respondents were Bangalore Electricity Supply <a href="https://bescom.karnataka.gov.in/english" target="_blank" rel="noopener">BESCOM</a>, Mangalore Electricity Supply <a href="https://mescom.karnataka.gov.in/english" target="_blank" rel="noopener">MESCOM</a>, Karnataka Power Transmission Corporation <a href="https://kptcl.karnataka.gov.in/english" target="_blank" rel="noopener">KPTCL</a> and State Load Dispatch Centre, Karnataka (<a href="https://kptclsldc.in/" target="_blank" rel="noopener">SLDC</a>).</p>
<p>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.</p>
<p>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.</p>
<p>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.</p>
<p>They also accused the petitioner of injecting power into the grid before the wheeling agreement&#8217;s execution, endangering the grid. They also claimed that banking facility is not an inherent right.</p>
<p>The respondents highlighted the discrepancies in the petitioner&#8217;s claim of establishing a group captive power project.</p>
<p>They said there was no obligation to pay the petitioner since the power injection was not pursuant to any agreement.</p>
<p>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.</p>
<p>The petitioner&#8217;s claim of entitlement to banking from February 23, 2021, does not hold because the executed wheeling agreement does not grant any banking rights.</p>
<p>KPTCL and SLCD also asserted that the petitioner is not entitled to any relief, including interim relief.</p>
<p><strong>Commission’s Analysis </strong></p>
<p>The Commission ruled that the petitioner&#8217;s power project cannot be deemed a captive power plant from its commissioning date on December 7, 2020.</p>
<p>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.</p>
<p>Therefore, group captive status can be granted only from the date of the government order on May 24, 2021.</p>
<p>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.</p>
<p>By providing an affidavit on December 7, 2020, the petitioner voluntarily relinquished its claim to banking by agreeing to wheeling without banking.</p>
<p>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.</p>
<p>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.</p>
<p>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.</p>
<p>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.</p>
<p>In June, KERC <a href="https://www.mercomindia.com/karnataka-clarifications-green-energy-open-access-rules" target="_blank" rel="noopener">clarified</a> various rules in the state’s Terms and Conditions for Green Energy Open Access Regulations 2022.</p>
<p>Recently, KERC <a href="https://www.mercomindia.com/karnataka-additional-surcharge-green-open-access" target="_blank" rel="noopener">approved</a> an additional surcharge of ₹1.40 /kWh (~$0.017) for consumers availing power through open access for the financial year 2023-24.</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>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/gautamee-hazarika/" class="vcard author" rel="author"><span class="fn">Gautamee Hazarika</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/10/Picture1.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Gautamee,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/gautamee-hazarika/" target="_blank" rel="noopener">More articles from Gautamee.</a><br />
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<a href="gautamee@mercomindia.com" target="_blank" rel="noopener">gautamee@mercomindia.com</a></p>
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<div class="authorboxn"><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/10/Picture1.jpg" width="102" height="102" /><a href="https://mercomindia.com/author/gautamee-hazarika/" rel="noopener">Gautamee</a> is a reporter at Mercom India. Prior to Mercom, Gautamee was working as a multimedia news journalist at ThePrint in New Delhi. She has received her Bachelors in English Honors and Masters in English Literature from St.Stephen&#8217;s College, University of Delhi.<a href="https://mercomindia.com/author/gautamee-hazarika/" rel="noopener">More articles from Gautamee</a></div>
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Karnataka Regulator Upholds Group Captive Status of 38 MW Wind Project

<p>The <a href="https://bombayhighcourt.nic.in/index.php" target="_blank" rel="noopener">Bombay High Court</a>, in a recent judgment in the case relating to an infrastructure project, has ruled that the issue of a letter of award results in a concluded contract between the parties. The cancellation of the letter of award by the implementing agency is arbitrary, unfair, and unreasonable and deserves to be quashed and set aside. The Court further added that the case involves enforcement of contractual obligations and an issue of enforcement of public law rights arising out of contractual obligations.</p>
<p>Although the case is related to the aviation sector, the landmark ruling of the Nagpur bench of the Court could have implications for other sectors, including the renewable energy sector, which has seen arbitrary cancellations of auctions by government agencies for solar projects in recent years.</p>
<p><strong>The case</strong></p>
<p>GMR had emerged as the highest bidder in the tender process conducted by MIHAN, a joint venture of the Maharashtra Airport Development Authority and Airports Authority of India, for the Nagpur airport in 2019. The authority also issued a Letter of Award to GMR in March 2019. However, in March 2020, the Maharashtra government canceled the tender process and issued a letter annulling the bid process.</p>
<p>GMR challenged the annulment of the tender process in the High Court.</p>
<p>Upholding GMR’s plea, the two-judge bench termed the cancellation of the bidding process ‘unfair and arbitrary.’</p>
<p>The Court has set aside the cancellation of the project awarded to GMR Airports to upgrade Nagpur airport and directed MIHAN India Limited to execute the concession agreement within six weeks.</p>
<p><strong>Similar issues in the solar sector</strong></p>
<p>Solar developers were at the receiving end of similar arbitrariness when in 2018. The Gujarat Urja Vikas Nigam <a href="https://mercomindia.com/guvnl-scraps-500-mw-solar-auction/" target="_blank" rel="noopener">scrapped</a> a 500 MW solar auction. In 2019 a 700 MW solar auction was also canceled, <a href="https://mercomindia.com/gujarat-cancels-700-mw-solar-auction/" target="_blank" rel="noopener">citing</a> high tariffs, after handing over letters of award to the winning bidders.</p>
<p>Aditya Singh, the Associate Partner at Link Legal, said, “This judgment has reiterated the established principle that the contract gets concluded post acceptance of the offer. This judgment may not have a direct impact on the electricity sector. However, this case law may be relied upon by developers against frequent bid cancellations by the distribution companies. In the recent past, we have seen distribution companies frequently cancel the bid process post-issuance of the letter of award on the grounds that are not mentioned in the bid document.”</p>
<p>“In the instant matter, the Bombay High Court, in clear terms, held that if there is a communication of the acceptance, the contract gets concluded. Relying upon this precedent, one can also challenge those cases where results have simply been announced without entering any formal arrangement. The only difference between this case and the electricity matter will be the role of the regulator,” he said.</p>
<p>Singh said that the Supreme Court had earlier held that the Electricity Regulatory Commission had a mandatory obligation to adopt the tariff if such tariff has been determined through a transparent bidding process in terms of the guidelines issued by the Government.</p>
<p><strong>Background</strong></p>
<p>In its petition, <a href="https://www.gmrgroup.in/airports/" target="_blank" rel="noopener">GMR Airports</a> Limited said it had submitted its bid for the project on September 29, 2018, and was adjudged to be the highest bidder. After that, MIHAN India issued a letter of acceptance dated March 7, 2019, to GMR Airports.</p>
<p>GMR Airports stated that it took various steps to implement the project as required per the letter of acceptance. It added that MIHAN India also acted in the direction of the implementation of the project.</p>
<p>However, later MIHAN India sent a letter to GMR Airports informing that it has canceled the bidding process without award of contract as per the directives received from the Government of Maharashtra.</p>
<p>GMR submitted that letter of acceptance is a Letter of Award. Therefore, the contract is concluded by both parties, which should lead to the execution of the Concession Agreement.</p>
<p><strong>MIHAN India’s response</strong></p>
<p>MIHAN India stated that it only communicated its acceptance of revised bids for a 14.49% share in the gross revenue by GMR Airports through the letter of acceptance, and it is not a case of any concluded contract. It opined that GMR’s offer of 14.49% gross revenue share is low and financially unviable and could cause loss to the public exchequer. Therefore, it has canceled the tender process within its rights and in terms of the tender document and opted for the fresh tender process in the public interest.</p>
<p>MIHAN said the acceptance of the bid was subject to the approval of the Government of India regarding the alienation of land owned by the Airport Authority of India. However, the Ministry of Civil Aviation (MoCA), through its communication dated August 20, 2019, raised questions regarding the present tender process. In addition, the secretary of MoCA also expressed dissatisfaction with the revenue share offered by GMR Airports and questioned the financial viability of the project.</p>
<p><strong>High Court’s analysis</strong></p>
<p>The High Court noted that MIHAN India accepted the revised offer of 14.49% gross revenue share by GMR Airports. It also noted that MIHAN India accepted the offer through its letter of acceptance.</p>
<p>After examining the letter of content, clauses of request for proposals, and intentions of the parties, the High Court stated that the letter of acceptance dated March 7, 2019, is a Letter of Award and not a letter of acceptance for a revised bid of 14.49% gross revenue share.</p>
<p>Regarding the cancellation of the bidding process, the High Court noted that the letter dated March 7, 2019, is a Letter of Award that means the contract has been concluded between both the parties. Therefore, GMR Airports holds the rights for the execution of the project through its subsidiary. The High Court found MIHAN India’s arguments regarding the cancellation of tender and re-tendering of the project arbitrary.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/harsh-shukla/" class="vcard author" rel="author"><span class="fn">Harsh Shukla</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><p><img class="alignleft" src="https://mercomindia.com/wp-content/uploads/2022/02/Harsh-Shukla-293x300-1-new.jpg" width="99" height="102" /><a href="https://mercomindia.com/author/harsh-shukla/" target="_blank" rel="noopener"><strong style="color: #00b451">Harsh Shukla</strong> </a>is a staff reporter at Mercom India. Previously with Indian Express, he has covered general interest stories. He holds a Masters Degree in Journalism from Symbiosis Institute of Media and Communication, Pune.</p>
<p><a href="https://mercomindia.com/author/harsh-shukla/">More articles from Harsh Shukla.</a></p>
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Issuing a Letter of Award Results in a Concluded Contract – Bombay High Court

<p>In an important development, the Central Electricity Regulatory Commission (<a href="http://www.cercind.gov.in/" target="_blank" rel="noopener noreferrer">CERC</a>) has directed the Central Transmission Utility (CTU) to revoke the stage-II connectivity of Toramba Renewable Energy. It has also asked the CTU to return the bank guarantee to the company within ten days from the issue of the order.</p>
<p>Toramba Renewable Energy was developing a 300 MW wind generation project at Horti in Osmanabad, Maharashtra.</p>
<p><strong>Background</strong></p>
<p>In May 2018, Toramba Renewable Energy filed a petition with the CERC seeking an extension for the financial closure of the project.</p>
<p>Toramba Renewable Energy had requested the commission to extend the timeline by nine months to procure the remaining land and to achieve financial closure.</p>
<p>The company had applied for stage-1 connectivity on July 20, 2018. Then in July 2018, Toramba applied for stage II connectivity, which was granted by PGCIL. Subsequently, the petitioner requested PGCIL to modify certain requirements provided in the stage-II connectivity. The company furnished a bank guarantee of ₹50 million (~$697,231) and had also said that it would also construct the dedicated 400kV S/C transmission line for the project.</p>
<p>Later in February 2019, the CERC issued its approval for the transmission line with a minimum capacity of at least 900 MW at a nominal voltage from Toramba Pooling Station to Solapur Powergrid sub-station.</p>
<p>The company received a no-objection certificate from the Airports Authority of India (AAI) in March 2019 for the construction of the project at the sites allotted.</p>
<p>After receiving assurance from the Maharashtra Energy Development Agency (MEDA), the nodal agency, the process of acquiring land began.</p>
<p>The petitioner submitted that it had taken substantial steps for developing the project and has already acquired 50% of the land but has not been able to achieve the financial closure within time due to a delay in issuance of notification of the policy framework by the state government.</p>
<p>The petition added that Maharashtra’s renewable energy policy only covers the projects which are being developed with the state transmission utility connectivity and to sell power to the distribution licensee or captive or open access users. There is no other policy framework for the development of wind power projects in the State of Maharashtra, the petition noted.</p>
<p>It has also been quoted in the petition that as per the clarification from the Ministry of New and Renewable Energy (MNRE) in 2018, for renewable projects being implemented by the Solar Energy Corporation of India (SECI), National Thermal Power Corporation (NTPC), and NTPC Vidyut Vyapar Nigam (NVVN) or any other agency on behalf of the MNRE, the mandatory registration with the state nodal agency would not be required.</p>
<p>Following this clarification, MEDA stopped registering wind power projects intending to sell power through the ISTS network. Further, due to the absence of MEDA’s registration for projects intending to sell power through ISTS connectivity, the company could not get exclusive rights over locations identified by it. Consequently, the petitioner lost some of the already acquired and developed locations and has found it challenging to procure land in other identified locations.</p>
<p>PGCIL, in turn, said that the demand for an extension of nine months was not sustainable as the petitioner chose to take the commercial risk of applying for connectivity issued by the Commission for grant of connectivity to projects which are based on renewable sources to interstate transmission system in 2018.</p>
<p>Having taken a business risk and being completely aware of the uncertainties involved, the company cannot now contend that the delay in the formulation of policy is a supervening event that was beyond the control of the petitioner.</p>
<p>Consequently, the Commission rejected the plea of the petitioner to grant an extension of time for its stage-II connectivity and permitted PGCIL to revoke the stage-II connectivity of the petitioner.</p>
<p>After listening to both sides, the Commission also noted that in line with the state policy, the project developer must submit an application for grid-connectivity in the prescribed format along with the details of the nearest sub-station.</p>
<p>The petitioner had requested that since it was not able to implement the projects, it had no other option but to surrender the connectivity and had requested the return of the bank guarantee furnished.</p>
<p>Now, according to PGCIL, the tendering process for the transmission line was completed, and there was no provision for discharging bank guarantee before the evacuation of power from the project.</p>
<p>Considering the complicated problem at hand, the central Commission decided to exercise its “power to relax”. Power to relax means that to remove unnecessary hardships, the Commission can relax any regulation and its provision that are causing the problem. Therefore, the Commission ordered to relax a provision under the detailed procedure passed in 2018 and has allowed the discharge of connectivity bank guarantee furnished by Toramba Renewable Energy.</p>
<p>In November 2019, the Maharashtra Electricity Regulatory Commission <a href="https://mercomindia.com/maharashtra-discom-delayed-payments-three-wind-generators/" target="_blank" rel="noopener noreferrer">directed</a> the Maharashtra State Electricity Distribution Company Limited to clear its outstanding dues with three wind developers in the state, including interest for delayed payment charges.</p>
<p>Previously, it was reported that the MNRE <a href="https://mercomindia.com/mnre-release-bank-guarantee-solar-wind/" target="_blank" rel="noopener noreferrer">directed</a> the National Thermal Power Corporation, and SECIto to release performance bank guarantee (PBGs) for the solar and wind power projects that have been commissioned. The MNRE states that the PBGs may be released within 45 days from COD (Commercial Operation Date), subject to fulfillment of requirements of submission of all the requisite documents.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/anjana/" class="vcard author" rel="author"><span class="fn">Anjana Parikh</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><p><img class="alignleft" src="https://mercomindia.com/wp-content/uploads/2019/06/Anjana2.png" width="112" height="121" />Anjana is a news editor at Mercom India. Before joining Mercom, she held roles of senior editor, district correspondent, and sub-editor for The Times of India, Biospectrum and The Sunday Guardian. Before that, she worked at the Deccan Herald and the Asianlite as chief sub-editor and news editor. She has also contributed to The Quint, Hindustan Times, The New Indian Express, Reader’s Digest (UK edition), IndiaSe (Singapore-based magazine) and Asiaville. Anjana holds a Master’s degree in Geography from North Bengal University, and a diploma in mass communication and journalism from Guru Ghasidas University, Bhopal.</p>
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CERC Provides Relief to Wind Developer by Relaxing Provisions of Maharashtra Policy

<p>In its latest order, the Andhra Pradesh Electricity Regulatory Commission (<a href="http://aperc.gov.in/" target="_blank" rel="noopener noreferrer">APERC</a>) has asked one of the state’s distribution companies (DISCOM), Andhra Pradesh Southern Power Distribution Company Limited (<a href="https://www.apspdcl.in/" target="_blank" rel="noopener noreferrer">APSPDCL</a>) to pay ₹4.5 million (~$62,710) as the full and final settlement towards biomass project developer Satya Maharshi Power Corporation Limited’s (SMPCL) claim for interest.</p>
<p>The respondent in the case was APSPDCL, and the petitioner was SMPCL.</p>
<p><strong>Background</strong></p>
<p>Satya Maharshi Power Corporation had filed a petition against APSPDCL for the payment of interest against the delayed payments of the bills raised for a 6 MW biomass power project with the power purchase agreement dated May 10, 2004.</p>
<p>The PPA clearly stated:</p>
<p><em>“For any payment made beyond the due date of payment, the state’s transmission company (APTRANSCO),  will pay interest at the rate of 10% per annum as per the existing nationalized bank rate and in case this rate is reduced, such reduced rate is applicable from the date of reduction.”</em></p>
<p>APSPDCL in its counter affidavit, however, did not dispute the petition and submitted that the non-payment was on account of the non-availability of funds.</p>
<p>As APSPDCL unequivocally undertook to pay bills within a stipulated time with the payment of surcharge for the delayed payment, the commission decided to grant relief to the biomass developer.</p>
<p>The counsel of the DISCOM mentioned that APSPDCL is in “heavy losses and that the petitioner may, in public interest, give up a part of the interest claim.”</p>
<p>Responding to the submission, the counsel for the petitioner agreed to receive ₹4.5 million (~$62,710) as the full and final settlement towards the claim made by Satya Maharshi Power.</p>
<p>The commission has asked the APSPDCL to pay the amount within 45 days, failing which, the respondent will be liable to pay the entire interest.</p>
<p>The <a href="http://cea.nic.in/" target="_blank" rel="noopener noreferrer">Central Electricity Authority</a>’s (CEA) recent report <a href="https://mercomindia.com/payment-dues-discoms-renewable-escalate/" target="_blank" rel="noopener noreferrer">states</a> that the total payment due for 513 renewable projects now amounts to ₹97.356 billion (~$1.356 billion) as of July 31, 2019, thus  showing an increase of nearly ~ ₹15 billion (~$0.21 billion) compared to the previous figure of ₹82.3 billion (~$1.14 billion) for the same period. In total, these 513 projects have renewable energy projects generating a capacity of over 26 GW.</p>
<p>In August 2019, <a href="https://mercomindia.com/payment-dues-state-discoms-solar-wind-hydro/" target="_blank" rel="noopener noreferrer">Mercom</a> had reported that the payment dues were for 472 projects spread across the states of Andhra Pradesh, Himachal Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Punjab, Odisha, Tamil Nadu, Rajasthan, Telangana, and Uttar Pradesh.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/anjana/" class="vcard author" rel="author"><span class="fn">Anjana Parikh</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><p><img class="alignleft" src="https://mercomindia.com/wp-content/uploads/2019/06/Anjana2.png" width="112" height="121" />Anjana is a news editor at Mercom India. Before joining Mercom, she held roles of senior editor, district correspondent, and sub-editor for The Times of India, Biospectrum and The Sunday Guardian. Before that, she worked at the Deccan Herald and the Asianlite as chief sub-editor and news editor. She has also contributed to The Quint, Hindustan Times, The New Indian Express, Reader’s Digest (UK edition), IndiaSe (Singapore-based magazine) and Asiaville. Anjana holds a Master’s degree in Geography from North Bengal University, and a diploma in mass communication and journalism from Guru Ghasidas University, Bhopal.</p>
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Andhra DISCOM to Pay ₹4.5 Million Against Delayed Payment for a 6 MW Biomass Project

<p>In one of the toughest moves to enforce the renewable purchase obligation (RPO) order, the <a href="http://www.rerc.rajasthan.gov.in/" target="_blank" rel="noopener noreferrer">Rajasthan Electricity Regulatory Commission</a> (RERC) has said that nine companies will be issued notices for the non-compliance of RPO order.</p>
<p>After reviewing a petition by the Rajasthan Renewable Energy Corporation Limited (<a href="https://www.recgroup.com/en" target="_blank" rel="noopener noreferrer">RRECL</a>), the commission has directed the issue of notices to the managing directors of all the respondent companies (excluding Binani Cement Limited (BCL) and Uttam Strips Limited) to show cause for the non-compliance of the commission’s order.</p>
<p>The RRECL has been asked to provide the list of names of the managing directors and directors of the respondent companies so that notices can be served to them.</p>
<p><strong>Background</strong>:</p>
<p>In March 2017, Rajasthan Renewable Energy Corporation Limited (RRECL) filed a petition for the non-compliance of RERC’s order on renewable purchase obligations (RPO).  RRECL is the nodal agency appointed by the RERC for ensuring RPO compliance.</p>
<p>The petition was filed against Binani Cement Limited, Mangalam Cement Ltd, J.K. Tyres &amp; Industries Ltd, Ruchi Soya Industries Ltd, Suzuki Spinners (Unit-II), Suzuki Spinners, Jodhpur Alloys Pvt. Ltd, Shristi Alloys Pvt. Limited, Suzuki Suitings, Uttam Strips Pvt Ltd, and Yantra Steels India Pvt. Ltd.</p>
<p>The case was heard in January 2019, and during the proceedings, it submitted the names of the 11 respondents who had made the compliance and requested the commission to drop the action against them.</p>
<p>On January 4, 2019, the commission allowed the request of the petitioner and dropped the proceeding against the proposed respondents.</p>
<p>In the meantime, two respondents—Binani Cement and Uttam Strips—represented their cases before the commission, stating that they were unable to repay their debts. The two companies said that their board of directors had been suspended as per the provisions of the Insolvency and Bankruptcy Code.</p>
<p>Meanwhile, Ultratech Cement Limited and Jyoti Strips Private Limited became the resolution applicants approved by the National Company Law Tribunal (NCLT) for Binani Cement Limited and Uttam Strips Limited.</p>
<p>Given this, the RERC believes that, now, Binani Cement and Uttam Strips cannot be held responsible for compliance with the commission’s order. However, all the other respondents did not represent their case, which will result in an action initiated against them.</p>
<p>Stating this, the commission has ordered that notices must be issued against the rest of the companies for their non-compliance.</p>
<p>Only last week, Delhi Electricity Regulatory Commission (DERC) <a href="https://mercomindia.com/delhi-penalizes-three-discoms-defaulting-rpo/" target="_blank" rel="noopener noreferrer">imposed penalties</a> of ₹17.2 million (~$240,000) on Tata Power Delhi Distribution Limited (TPDDL) and ₹28.8 million (~$410,000) each on BSES Yamuna Power Ltd. (BYPL) and BSES Rajdhani Power Ltd. (BRPL), for defaulting on renewable energy purchase obligations for three financial years.</p>
<p>In March 2019, <a href="https://mercomindia.com/rajasthan-amends-regulations-rec-and-rpo/" target="_blank" rel="noopener noreferrer">Mercom</a> had reported that the Rajasthan Electricity Regulatory Commission (RERC) issued new amendments to its regulations on renewable energy certificate and renewable purchase obligation compliance framework that was initially passed in 2010.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/anjana/" class="vcard author" rel="author"><span class="fn">Anjana Parikh</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><p><img class="alignleft" src="https://mercomindia.com/wp-content/uploads/2019/06/Anjana2.png" width="112" height="121" />Anjana is a news editor at Mercom India. Before joining Mercom, she held roles of senior editor, district correspondent, and sub-editor for The Times of India, Biospectrum and The Sunday Guardian. Before that, she worked at the Deccan Herald and the Asianlite as chief sub-editor and news editor. She has also contributed to The Quint, Hindustan Times, The New Indian Express, Reader’s Digest (UK edition), IndiaSe (Singapore-based magazine) and Asiaville. Anjana holds a Master’s degree in Geography from North Bengal University, and a diploma in mass communication and journalism from Guru Ghasidas University, Bhopal.</p>
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Rajasthan Regulator to Issue Notices to Companies for Non-Compliance of RPO

<p>The Uttarakhand Electricity Regulatory Commission (<a href="http://www.uerc.gov.in/" target="_blank" rel="noopener noreferrer">UERC</a>) has allowed Uttarakhand Power Corporation Limited (UPCL) to carry forward the surplus non-solar renewable purchase obligations (RPO) of the financial year (FY) 2019-20 to meet the deficit of non-solar and solar RPO.</p>
<p>The commission, however, states that the order is for a standalone case, and “such allowance will not be permitted in the future.”</p>
<p>The commission has also observed that UPCL has considered 15% of the surplus of non-solar RPO to meet the deficit of solar RPO and has advised it to properly plan as to how it would meet its solar and non-solar RPO well in advance to avert such a situation from arising in the future.  Some important points to note in the order:</p>
<p>As per Regulation 9 of RE Regulations, 2018, the shortfall in solar RPO compliance can be met by excess non-solar RPO only if 85% of the solar RPO is achieved. However, as per the projections submitted by UPCL for FY 2019-20, solar RPO compliance would only be 69.41%. UPCL will not be allowed to meet the deficit of solar RPO with the surplus non-solar RPO since the projection of achievement of solar RPO compliance is below 85%.</p>
<p>UERC has advised UPCL to procure the power from solar sources or solar renewable energy certificates (RECs) at least up to 85% of the total energy consumption, excluding hydro, and only after meeting it can UPCL adjust the surplus non-solar RPO with the deficit of solar RPO.</p>
<p>The Commission concluded, it has taken into account the fact that the UPCL had floated tenders to procure renewable energy and also purchases RECs to comply with the RPO regulations to meet the deficit of solar and non-solar RPO up to March 2018. Considering the case as exceptional the Commission allows UPCL to carry forward the surplus non-solar RPO of FY 2018-19 to FY 2019-20 to meet the deficit of non-solar and solar RPO as a standalone case and it will not be permitted in future.</p>
<p>The Commission justified that it allowed the carry forward because it would have negative financial implications on UPCL and also on consumer tariffs. However, it advised UPCL to properly plan how it would meet its solar and non-solar RPO well in advance in the future so that such a situation can be averted. No such carry forward would be allowed in the future, and the additional cost that the UPCL will have to bear due to such inactions will not be permitted as pass-through in tariffs.</p>
<p><strong>Background</strong></p>
<p>On July 12, 2019, the Uttarakhand Power Corporation Limited had filed a petition before the UERC seeking to carry forward of surplus RPO in FY 2018-19 to FY 2019-2020 in accordance with the provisions of UERC’s Compliance of Renewable Purchase Obligation Regulations, 2010.</p>
<p>The respondent, in this case, was the Uttarakhand Renewable Energy Development Agency (UREDA).</p>
<p>In April 2018, a tender was floated for the purchase of non-solar and solar power, which was successfully procured during FY 2018-19.</p>
<p>As per the UERC order, to meet the deficit of RPO up to March 2018, UPCL had purchased solar and non-solar equivalent to 60.50 MU (million units) and 103.50 MU, respectively. Due to the purchase of renewable energy certificate (REC) equivalent to 103.56 MU, UPCL had a surplus in the case of non-solar RECs as it had already planned to meet the amount by purchasing non-solar renewable energy instead of RECs.</p>
<p>Later, UPCL adjusted the surplus non-solar RE to meet the deficit of solar RPO as per RE Regulations 2018, which was having a surplus of 139 MU, which it requested the commission to allow to carry forward to the FY 2019-20 so that the RPO for ensuing year can be met.</p>
<p><a href="https://mercomindia.com/wp-content/uploads/2019/10/UPCL-RPO-Sttaement-for-FY-2018-20-aand-FY-2019-20.png"><img decoding="async" loading="lazy" class="aligncenter size-full wp-image-15873" src="https://mercomindia.com/wp-content/uploads/2019/10/UPCL-RPO-Sttaement-for-FY-2018-20-aand-FY-2019-20.png" alt="UPCL - RPO Sttaement for FY 2018-20 aand FY 2019-20" width="399" height="443" srcset="https://cms.mercomindia.com/wp-content/uploads/2019/10/UPCL-RPO-Sttaement-for-FY-2018-20-aand-FY-2019-20.png 399w, https://cms.mercomindia.com/wp-content/uploads/2019/10/UPCL-RPO-Sttaement-for-FY-2018-20-aand-FY-2019-20-270x300.png 270w" sizes="(max-width: 399px) 100vw, 399px" /></a></p>
<p>As per RE Regulations, 2018, 15% of solar RPO can be met from non-solar renewable energy power, and thereby after adjusting the deficit solar RPO from excess non-solar power, UPCL achieved the non-solar and solar RPO for FY 2018-19.</p>
<p>Recently, Mercom had reported that the Uttarakhand Electricity Regulatory Commission had <a href="https://mercomindia.com/gross-tariff-solar-uttarakhand/" target="_blank" rel="noopener noreferrer">issued</a> benchmark tariffs and capital costs for solar power projects in the state. The state commission has also <a href="https://mercomindia.com/uttarakhand-benchmark-generic-tariff-solar-projects/" target="_blank" rel="noopener noreferrer">approved</a> the extension of benchmark capital cost and generic tariff for the financial year 2019-20 (up to October 2020) for the upcoming solar projects of 52 MW in the state.</p>
<p>In another development, the UPCL <a href="https://mercomindia.com/uttarakhand-discom-amend-draft-ppa-solar-projects/" target="_blank" rel="noopener noreferrer">approached</a> the Uttarakhand Electricity Regulatory Commission seeking its approval for the model power purchase agreement (PPA) between the petitioner and the selected bidders for setting up 200 MW of grid-connected solar photovoltaic power projects.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/anjana/" class="vcard author" rel="author"><span class="fn">Anjana Parikh</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><p><img class="alignleft" src="https://mercomindia.com/wp-content/uploads/2019/06/Anjana2.png" width="112" height="121" />Anjana is a news editor at Mercom India. Before joining Mercom, she held roles of senior editor, district correspondent, and sub-editor for The Times of India, Biospectrum and The Sunday Guardian. Before that, she worked at the Deccan Herald and the Asianlite as chief sub-editor and news editor. She has also contributed to The Quint, Hindustan Times, The New Indian Express, Reader’s Digest (UK edition), IndiaSe (Singapore-based magazine) and Asiaville. Anjana holds a Master’s degree in Geography from North Bengal University, and a diploma in mass communication and journalism from Guru Ghasidas University, Bhopal.</p>
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