CERC seeks additional information from Parekh Committee

Central Electricity Regulatory Commission (CERC) has sought additional information from Parekh Committee on compensatory tariff for power projects of Tata Power and Adani Power at Mundra in Gujarat. The regulator has also asked the committee to get the report signed by all the representatives as committee members.

“We have sought additional information from Dr Parekh and the committee to decide on the case when we hear it later this month. We have also said that the report may be signed by all the members as committee-members,” a senior CERC official told Business Standard. He added the objective is to clarify that the views of the members do not represent the views of the respective state governments.

The Parekh Committee was set up by CERC in April to work out the quantum of “compensation” over the current tariff for the two projects of around 4,000 Mw capacity each due to the impact of “unanticipated” increase in price of imported coal. Based on its recommendation, the tariff for the 4,000 Megawatt Mundra Ultra Mega Power project (UMPP) may go up by 58 paise per unit in the current financial year, according to sources. A similar hike has been proposed for Adani project too.

The committee had suggested adjusting the compensation in line with global prices and the benefits earned from the overseas mines owned by companies. As per the committee’s recommendation, the tariff for the projects is to be reviewed every quarter.  The panel has also suggested imposing a ceiling on the compensatory tariff. It has also floated the idea of third-party sale of power beyond the normative availability.