For the third time in August, APTEL places apart the KERC order – Saurenergy

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  • The order follows the same pattern for all projects set up under a 2014 program. The emphasis on the intent of APTEL on the spirit of intent behind the scheme is to be commended.
  • All of them involve delays by government agencies that put farmers who chose the program into trouble.

For the third time this month, the APTEL (Appellate Tribunal For Electricity) has deemed it appropriate to repeal an order from the Karnataka State Regulatory Commission (KERC). While the general theme is the same, this time the beneficiary is Sirwar Renewable Energy Private Limited, based in Hyderabad, a company that had built a 2MW solar power plant as part of a plan released by the Karnataka government in 2014.

After receiving approval to build a 2 MW plant, the developer signed a PPA with Gulbarga Electricity Supply Company Limited (GESCOM) on July 1, 2015. Accordingly, the planned commissioning date for the project was set for 18 months after the PPA or December 31, 2016 according to the rules in force at the time.

The landowner who founded the company to carry out the project then set out to obtain government permits, with the latter, the supplementary power purchase agreement that recognized the company and gave the project access to the bank fund, was not concluded until 08/28/2016 .

The regular evacuation permit for generated electricity was also only issued on September 6, 2016. The approval of the initiation plan for the connection of the project with an 11-KvA line to the next KPTL substation did not take place until December 2, 2016. 2016, after several follow-ups. Land for the broadcast bay was only officially made available by KPTL on December 9, 2016.

In the case of only one approved device supplier, MEIL, to whom the applicant placed the device order on September 27, the device was ultimately not delivered on time. The last chance to have the project finished by December 31, 2016 is wasted. The applicant finally managed to get the project up and running on January 21, 2017 and certify the state commission for the ratification of the delay.

The State Commission (KERC) duly rejected the application and found that the complainant was not entitled to the remedies requested by the complainant. The Commission also found that the complainant was entitled to a tariff of Rs. 6.51 / – (Rupees Six and Paisa Fifty One) per unit, per different tariff in effect on the day the complainant's facility was put into operation, as of set by the Commission in the regulation of 30.07.2015 for the duration of the PPA, as in accordance with Article 5.1 of the PPA. The Commission also found that the complainant was also liable for damages, including lump-sum compensation claims under Articles 2.2 and 2.5.7 of the aforementioned PPA. In fact, the 15-16 month delay is tolerated by government agencies, but a 21-day delay is punished by the developer in a hurry.

APTEL Bank noted that a program intended to support farmers has effectively become a curse for those who chose to go through it, thanks to the approach and attitude of government agencies that resulted in immeasurable delays at every stage, and finally the KERC, which decided to repeatedly ignore indications to the contrary and to take these force majeure events into account. Thus, the appeal was granted and the contested ruling was revoked. The commission also confirmed that the developer is entitled to Rs. 8.40 per unit in PPA from the commissioning of the solar power plant. It instructed GESCOM to pay the difference in the tariff paid per unit from the date on which the judgment went into operation in Annex, together with the late payment surcharge in the form of PPA, within one month from today. No liability of the developer for damages and thus also lump-sum damages.

KERC in particular has been at the wrong end of APTEL's decisions lately, advocating more independent and competent appointments.


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