SC sets aside GERC order to extend control period for discom

The Supreme Court today set aside the order of the Gujarat Electricity Regulatory Commission (GERC) extending the 'control period' to allow a private discom to levy a particular rate power tariff on grounds of delay in commissioning of the project.
However, the apex court also made it clear that the private discom, Solar Semiconductor Power Company (India) Private Limited, can re-approach the Commission for re- determination of the tariff by citing all contentions relevant under the law.
The company had entered into an agreement for sale and purchase of electricity from 20 MW Solar PV Power project and its commissioning got delayed on grounds like change in land acquisition law and shifting of the Solar Power project from Banaskantha district to Kutchh. The project was to be completed by December 31, 2011.

The bench allowed the appeal of Gujarat Urja Vikas Nigam Limited challenging the order that had extended the "control period" to allow the private discom to charge a particular power tariff.
A private discom was allowed to charge fixed power tariff during 'control period' as per the agreement and it is usually different from the regulated tariff.
"Extension of control period has been specifically held to be outside the purview of the power of the Commission... This appeal is hence, allowed. The impugned orders are set aside," a bench of Justices Kurian Joseph and R Banumathi said.

"This court should be specially careful in dealing with matters of exercise of inherent powers when the interest of consumers is at stake. The interest of consumers, as an objective, can be clearly ascertained from the Act.

"The Preamble of the Act mentions 'protecting interest of consumers' and Section 61(d) requires that the interests of the consumers are to be safeguarded when the Appropriate Commission specifies the terms and conditions for determination of tariff," it said.
The top court said that the GERC "being a creature of statute" cannot assume to itself any powers which are not otherwise conferred on it.