 "Rs 1,000-cr booster for R-Power after tribunal order")
Dismissing an order against Reliance Power's Sasan Ultra project, the Appellate Tribunal of Electricity (APTEL) quashed a three-year-old contentious issue over the commercial operating date of the plant.
The capacity of the Sasan Ultra Mega Power Project (UMPP) is 4,000 Mw. Reliance Power claimed in a statement that it could benefit by Rs 1,030 crore because of the order.
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In August 2013, the Western Region Load Dispatch Centre (WRLDC) had filed a case with the APTEL against Reliance Power, claiming that the company could not achieve its full load by March that year, leading to a delay in the date of commissioning (COD). This, in turn, led to tripping of power supply. APTEL had directed the case to the Central Electricity Regulatory Commission (CERC). In an order in August 2014, the commission said the COD suggested by the company could not be accepted as the full load could not be achieved by then.
CERC also directed the Sasan to sell power at 70 paisa - instead of Rs 1.19 - per unit, which was the quoted tariff for the third year.
Reliance Power, in its petition with APTEL, contested the CERC order.
The tribunal noted this was an "arbitrary and discriminatory treatment by WRLDC."
It also said the distribution centre "ought not (to) be permitted to single out Sasan, especially since WRLDC was seeking clarifications regarding the commissioning and COD process for all generating stations whose tariff is not determined under Section 62 of the Electricity Act, 2003."
Reliance Power (R-Power) was naturally very happy with the outcome.
"The APTEL order now paves the way for Sasan Power Limited to recover the unpaid amount of nearly Rs 850 crore from the procurers. Sasan Power would also be entitled to nearly Rs 200 crore of carrying cost as per the power-purchase agreement (PPA)," said the company. Reliance Power won the tender for the Sasan project by quoting a tariff of Rs 1.196 per unit in 2007. Sasan Power Limited (SPL) was supposed to sell power for the first two financial years at 70 paisa per unit, and then at for Rs 1.19 per unit.
The clause in the projects PPA was that if the unit was commissioned before 31 March, the generator was entitled to increase tariff, otherwise it had to operate on lower tariff for a year. In order to avoid it, SPL decided to commission the unit just days before the deadline - a move termed as "gaming by the generator" by CERC.
Making an exception, the APTEL reprimanded both CERC and WRLDC.
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POWER PLAY The APTEL order of Thursday ends a 3-year-long order against Reliance Power |
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2013 March: Sasan UMPP achieves COD of first unit August: WRLDC files case in APTEL against Sasan for not achieving full load. APTEL directs case to CERC 2014 August: CERC rules in favour of WRLDC saying Sasan could have achieved full load, noted “gaming of power by R-Power”.
March: APTEL rules in favour of Sasan. Says COD not in purview of WRLDC
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"The acceptance for COD of the power plant is an issue between the procurers and the generator and the same was not referred by any procurer to the central commission for adjudication.
The learned counsel for WRLDC has also submitted that WRLDC is not in any manner concerned with the dues or payments payable by procurers to the appellant/Sasan Power," said the APTEL decision, reviewed by Business Standard.
The APTEL also stated the observations made by the central commission are beyond the scope of prayers made in the petition and should be put aside.
"All the findings and observations made by the learned central commission in the impugned order beyond the scope of the payers of the impugned petition are liable to be set aside or quashed as suffering from perversity or illegality and based on improper appreciation of the material available before the central commission as regards to the prayers made in the impugned petition," said the order.
Sasan power project has six units of 660 Mw each.
According to the supplemental power purchase agreement (SPPA), Reliance preponed the commissioning of all of its six units. The Sasan project achieved full commissioning in March 2015. Among the procurers from the plant are utilities in Madhya Pradesh, Uttar Pradesh, Punjab and Rajasthan. Reliance Power shares closed at Rs 49.35, at high of 3.68 per cent.
