High Court breather for Andhra Pradesh renewable power companies

Dismisses panel formed to review tariffs for buying power

The Andhra Pradesh High Court (HC) on Tuesday dismissed a committee that was formed to review tariffs for buying renewable power, putting a halt to the stand-off between the state government and energy players.

The HC also asked the state government to clear dues of developers. The dues of renewable power producers in Andhra are more than Rs 2,500 crore at the end of July 2019, according to the power ministry data.   

The court asked the Andhra Pradesh State Electricity Regulatory Commission (APERC) to decide on tariff in six months from the date of the order. A copy of the order was not available.

The court also set an interim tariff of Rs 2.44 a kilowatt per hour (unit) for wind and Rs 2.43 a unit for solar power projects till the time APERC takes a decision. It also cautioned the state against curtailing any renewable power and disconnection of any clean energy project, said one of the petitioners.

Industry sources said the project developers would move a separate petition in the APERC claiming deemed generation loss that they suffered since July when the state stopped purchasing renewable power. 

 The Andhra government, led by NDA ally YSR Congress Party, had in July formed a high-level negotiation committee to “review, negotiate and bring down” tariff of all renewable power projects that had been given out by the previous Telugu Desam Party government. 

The state had cited the poor financial status of its power distribution companies (discoms) as the reason to review the tariff. In its further notices and presentations, it said the PPAs signed by the earlier government were inked with “mala fide intentions” and could have resulted in unjustified burden on the consumers. The state, in its notice, said it wants to fix tariffs of several wind power projects at Rs 2.25 per unit.

Indian Wind Power Association, along with a dozen wind power companies and a couple of solar companies such as ReNew Power, ACME Solar, and Wareee Energy, moved writ petitions in the Andhra Pradesh HC. Greenko Energy, which is based in Andhra, said in its petition that the state government’s decision to revise PPAs is “arbitrary illegal unconstitutional and also violative of principles of natural justice”.

APERC, which will now look into the tariff structure of solar and wind power projects, has been hearing similar matter since 2017. The regulator was presiding over a matter of reduction in tariff of renewable power projects in the state that the project developers had contested. 

The developers are confident that the regulator would now decide on the issue expeditiously. In a recent case filed by Hero Future Energies over revision of tariff, the APERC ruled in favour of the developer and upheld the original tariff.

Relief for energy players
 

•  HC asks APERC to look into the tariff structure
• Directs the state to clear dues of renewable energy players
•  Sets interim tariff of Rs 2.43/unit for solar and Rs 2.44/unit for wind while the matter is heard at APERC
•  Directs the state to not curtail or disconnect any renewable power project