APTEL Restores Tariff Of Rs 8.40/unit For Solar Developer In Karnataka

By Prasanna Singh/ Updated On Tue, Jan 11th, 2022

Highlights :

While consistency in these orders is welcome, the delay and obvious wastage of time caused by what should be obvious rulings is not good.
State regulators need to tighten up in their reasoning as well as due diligence on orders, considering the slew of orders seen overturned in recent months.

In case involving a solar power developer, Vatsala Bellary Solar Projects Private Limited versus the Karnataka Electricity Regulatory Commission (KERC) and Bangalore Electricity Supply Company Limited (BESCOM), the Appellate Tribunal for Electricity (APTEL) has ruled to restore the original tariff of Rs 8.40/unit over the revised tariff of Rs 4.36/unit that KERC had imposed on the developer.

The key issue that APTEL ruled on was whether the project qualified for condoning the delay in start of scheduled operations, which was blamed on the time taken by government agencies to allow land conversion. In this, APTEL referred to previous orders by it as well as a judgement of the Supreme Court, which had ruled in favour of similarly placed developers in the state. Even a three member state committee tasked with investigating the issue, common across many small developers, had found merit in the argument of delays caused by government departments involved.

Accordingly, the committee had recommended allowing the discom (Bescom in this case ) to allow for a six month extension to such cases on a case by case basis. However, the KERC, in a general order subsequently, had decided to arrogate the right to such extensions only after approval from itself.

APTEL Rules In Favour of PGCIL On Cost Overruns

Also Read

That led to a piquant situation in this case where the developer, even after receiving a letter from BESCOM allowing a six month time extension, and hence meeting its new deadline for start of commercial operations, faced the prospect of going through KERC subsequently. The KERC, in its wisdom, decided to impose liquidated damages and reduced the project tariff to Rs 4.36/unit for the delay.

The APTEL order here referred to its own previous order/s as well as the SC order, reminding everyone concerned that in similar cases earlier it has already passed adverse comments against the KERC for taking such a stand.

Thus, it restored the tariff orders, and also instructed BESCOM to clear the arrears due to the solar developer since start date, as the discom had been paying at the lower rate till now.