APTEL Sees Merit in Petition by Adani Firms Seeking Project Tariff at Rs. 7.01/unit

Highlights :

  • The judgement by APTEL sets aside the order by TNERC that would have reduced the tariff on both these projects significantly.
APTEL Sees Merit in Petition by Adani Firms Seeking Project Tariff at Rs. 7.01/unit


Kamuthi Solar Power Ltd (KSPL) and Ramnad Renewable Energy Ltd (RREL). The two appellants involved have Adani Green Energy as their parent company.


Tamil Nadu Electricity Regulatory Commission (TNERC); Tamil Nadu Generation and Distribution Corporation Limited; Chief Engineer/Non‐Conventional Energy Sources (NCES); Tamil Nadu Transmission Corporation Limited

The Appeal

The two appeals have been filed questioning the rejection of COD as claimed by the appellants, followed by the rejection of tariff for projects as Rs. 7.01 per unit, as notified by State Commission for the projects that were commissioned on or before 31.03.2016.

The Backdrop

KSPL and RREL signed separate Energy Purchase Agreements (EPAs) dated 04.07.2015 with Tamil Nadu Generation & Distribution Corporation Ltd (TANGEDCO) for the execution of 216 MW and 72 MW solar power projects, respectively in Tamil Nadu.

Factual Matrix 

The two firms proposed to set up solar power plants of varied capacity using solar PV technology in Tamil Nadu in alignment with the Solar Energy Policy SEP). One of the features of the policy by the State Government was to stimulate the establishment of solar plants and fixation of tariff at a nominal charge with respect to solar power, where solar PV technology is employed.

As mandated by SEP, TNERC issued a tariff order for solar power fixed at Rs. 7.01 per unit. On 21.01.2015, Model Energy Purchase Agreement was approved by TNERC for the appellants. The control period of the tariff was fixed as one year from the date of the order.

A few review petitions were filed against the tariff order, questioning the issue of control period, which was quashed by TNERC, which suo motu, began proceedings to look into extending the control period for applicability of the preferential tariff. On 01.04.2015, the control period of solar power tariff was extended till 31.03.2016. Consequently, the solar power projects commissioned on or before 31.03.2016 were applicable for a tariff of Rs. 7.01 per unit.

On 26.05.2015, KSPL proposed the establishment of 216 MW solar PV power plant at Sengapadai and Pudukottai Villages, Kamuthi Taluk, Ramnad District. RREL, on the other hand, put for the proposal for the setting up of a 72 MW solar PV
power plant at O. Karisalkulam village, Kamuthi Taluk, Ramnad District.

On 16.06.2015, the appellants submitted an undertaking to TANGEDCO stating that they would not claim any deemed generation or any other benefits from TANGEDCO if TANTRANSCO could not commission the proposed 400 kV substation at Kamuthi, Ramnad District. The undertaking further held that the grid connectivity is to be impacted only following the commissioning of the sanctioned new Kamuthi SS at Kamuthi.

TANGEDCO, in its letters dated 17.06.2015, addressed individually to the two appellants, put forth the proposal to interface the two generating stations power plant with TANTRANSCO grid at the sanctioned new Kamuthi SS. The grid connectivity was to be impacted only after commissioning of sanctioned new Kamuthi SS at Kamuthi.

Further, individually, the appellants had made a payment of 50% of the applicable refundable security deposit. The appellants were accordingly required to pay the rest of the 50% for further consideration of its proposal.

In compliance, the KSPL furnished the complete security deposit of Rs. 1001.50 Lakhs dated 29.04.2015 and
dated 17.06.2015 for the setting up of the 216 MW solar PV power plant.

RREL furnished the security deposit of Rs. 425.50 Lakhs dated 02.05.2015 and dated 17.06.2015 for of the 72 MW solar PV power plant.

Control Period 

Following the execution of the EPA, appellants were to commission their projects on or before 31.03.2016 to be able to avail the preferential tariff at Rs. 7.01/unit.

Force Majeure

Excessive rainfall in Tamil Nadu during the period cause delays in both the projects. The appellants informed TANGEDCO of the force majeure.

Delay in Provision of Evacuation Facility 

The Chief Electrical Inspector of the Government inspected the projects of KSPL and RREL on 12.03.2016 and on 11.03.2016, notifying the appellant to commission project within three months, which could not be achieved since the evacuation facility to be provided by the respondents was delayed- the respondents failed to
commission the Kamuthi Substation timely, putting off the commissioning the appellant’s project before 31.03.2016.

The appellants requested the Chief Engineer to consider the alternate proposal by allowing them to evacuate power through one circuit of 110 KV D/C Old Kamuthi Substation to New Kamuthi Sub‐station line.

The appellants informed the Chief Engineer and Superintending Engineer, Solar Energy/NCES, that the projects were ready to begin evacuation of power since 22.03.2016. They were, however, not able to evacuate power because of inaction from TANGEDCO


TANGEDCO alleged that the projects were not ready for commissioning and the appellants are not applicable for any
deemed generation or any other benefits from TANGEDCO. The appellants denied this claim and filed a petition for the same stating that the solar PV plant is ready for commissioning. The appellant also submitted the CEIG (Chief Electrical Inspectorate Division) certificate as conclusive proof that asset was ready to be commissioned.

Respondent number 2 and 3 submitted that the approval of the CEIG was accorded as temporary/provisional for a period of three months and the said certificate did not represent commissioning.

The APTEL Order 

The APTEL has said-

“We find merit in the contention of the Appellants that their decision to forgo the deemed generation on account of delay in commissioning of the transmission system cannot be construed to have included tariff as well. The undertaking to forgo deemed generation would only relieve the procurer from the responsibility of making payment for energy that could not be generated on account of delay in commissioning of the transmission system. There is no reference to waiver of tariff in the aforesaid undertaking.

Including the provisions of the EPA, it is evident that the appellants never agreed to the proposal of applicability of tariff prevailing at the time of commissioning of Sub-station. The respondent sought an undertaking from the appellant
generators that the applicable tariff will be as fixed by the TNERC at the time of commissioning of SS in case delay in commissioning of the 400 KV sub-station beyond 31.03.2016. The appellants entered into Energy Purchase agreement on 04.07.2015 without furnishing the undertaking sought by TANGEDCO. Thus, the contention of the respondent to consider waiver of deemed generation to include waiver of Tariff is devoid of merit.”

“As regards waiver of ‘any other benefit’, the Commission has considered the expression to have broad meaning which would include ‘tariff’ as well.”

The final judgement is as follows:

“We hold that the solar PV plants commissioned by the Generators,  Kamuthi Solar Power Ltd. and Ramnad Renewable Energy Ltd. have achieved commissioning within the control period ending on 31.03.2016 and are entitled for a tariff of Rs. 7.01/unit from 18.09.2016.”



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