ACME Solar’s Rajasthan Projects Back On Track, After Withdrawal OF Termination Notice

ACME Solar, which had filed for termination of some of its solar projects in Rajasthan, has withdrawn the termination notice, following an amicable settlement of the issue with SECI (Solar energy Corporation of India). This was informed by the firm at the Central Electricity Regulatory Commission (CERC), where it had filed the plea for termination.

The plea had created a flutter, thanks to the high visibility of these projects as the lowest solar bids when they were won in 2018, at Rs 2.44 per unit. Ever since, however, the developer had to contend with a rash of issues, from SGD, to land related issues and of course covid, Finally, the threat of encashment of bank guarantees due to delays forced it to demand termination and return of its deposits.

The possible game changer here for ACME has been its deal with Scatec Solar, which has agreed to partner it in funding and establishing these projects.

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The plea had been filed by ACME Deoghar Solar Power Pvt. Ltd. and ACME Dhaulpur Powertech Pvt. Ltd., special purpose vehicles incorporated by ACME Solar that were/are developing 600 MW (300×2 MW) Solar Power Projects at Tehsil Pokhran in the State of Rajasthan.

The said Petition was admitted on 14.5.2020 when the commission directed the Respondents, SECI and PGCIL (Power Grid Corporation of India Limited), not to take any coercive measures against the Applicants till the next date of hearing and the Applicants were directed to keep the Letter of Comfort and Bank Guarantee valid.

Subsequently, SECI allowed the extension of the project completion and scheduled start date (SCOD) to 3.3.2022, something ACME solar has accepted for now and confirmed the same too. However, with PGCIL limiting the extension of LTA (Long term transmission agreement) till 26.3.2021 or commissioning of ISTS for LTA, whichever is later, ACME has filed a petition to inter-alia seek a declaration that it is not liable to pay transmission charges/losses on account of extension of SCOD by SECI due to force majeure for delay in start date of LTA. That petition is still in the works.

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In what seems to be a happy ending eventually for ACME, one has to wonder how much of the new flexibility is due to the recent fund raising by the firm. The firm has announced three funding deals, from Scatec Solar, to UNOPS3i to  Brookfield of course.