1. SC seeks replies from CERC, discoms on Adani Power plea

SC seeks replies from CERC, discoms on Adani Power plea

The Supreme Court on Friday sought replies from the Central Electricity Regulatory Commission...

By: | New Delhi | Updated: November 8, 2014 1:30 AM

The Supreme Court on Friday sought replies from the Central Electricity Regulatory Commission (CERC), Haryana and Gujarat discoms on Adani Power’s appeal seeking a hike in power tariffs due to “unprecedented and unforeseen” escalation in the price of coal imported from Indonesia.

A bench headed by Justice J Chameleswar sought replies from the CERC, Gujarat Urja Vikas Nigam, Uttar Haryana Bijli Vitran Nigam (UHBVN) and Dakshin Haryana Bijli Vitran Nigam (DHBVN), and posted the matter for hearing on Monday. Adani Power supplies 1,424 MW electricity from its 4,620-MW Mundra power plant to Haryana state power utilities. It also supplies power to Gujarat-based state power utilities.

Adani Power had earlier challenged a part of the CERC’s April 2013 order before the Appellate Tribunal for Electricity (Aptel), which had rejected its plea in October on grounds of “inordinate delay” in filing the appeal.

Similar pleas made by the Coastal Gujarat Power (CGPL), a wholly-owned subsidiary of Tata Power Company, were rejected by the Aptel. CGPL’s appeal is pending before the Supreme Court. Another apex court bench headed by Justice JS Khehar, on CGPL’s appeal, had in October sought replies from the power ministry, the CERC, GUVNL, Maharashtra State Electricity Distribution Company, Ajmer Vidyut Vitaran Nigam, Jaipur Vidyut Vitaran Nigam, Jodhpur Vidyut Vitaran Nigam, Punjab State Power Corporation, UHBVN, DHBVN and Prayas Energy Group.

Last year, Adani Power had approached the CERC claiming that a rise in prices of coal from Indonesia (with which it has coal supply agreement) had increased its operational cost and had requested adjustments in tariff under the power-purchase agreements (PPAs) with state power utilities.

Challenging the Aptel’s order that refused to condone delay in filing appeal against the CERC order, Adani Power said that the order destroyed its right to “pursue its remedy, qua the violation of its legal rights (rejection of its claim under Change in Law and Force Majeure in terms of the PPA) on these technicalities”, despite it having acted bonafide in pursuing the possibilities of arriving at an acceptable solution rather than resorting to parallel proceedings distracting from the settlement.

The tribunal is not correct in denying an opportunity to challenge and/or defend an order passed during the course of proceedings by CERC, which though concluded in its favour, Adani said, adding that despite sufficient cause being shown for the delay including the fact that it “actively and diligently pursued matters in the interregnum before a High Powered Expert Committee appointed by the Commission by the same order which resulted in the final order granting reliefs” to it.

CERC while allowing compensatory tariff to CGPL and Adani Power last year, had asked the power procuring states to form a panel and decide on the quantum of compensation. The committee headed by HDFC Bank chairman Deepak Parekh had recommended that CGPL should be allowed an increase of 45-55 paise tariff in its Mundra plant.

Based on the report, CERC had in February 2014 ruled power-generation companies be allowed to adjust the compensation arising out of the increasing cost of domestic fuel and rising dependence on costly imported fuel. Subsequently, Aptel had on July 21 this year awarded Tata Mundra UMPP compensatory tariff at 54 paise per unit and Adani’s Mundra project had got compensatory tariff at 41 paise unit. While it allowed both the firms to recover power dues from March 2013 on account of rise in imported fuel cost, it restrained them from recovering any pre-March 2013 arrears.

Various state discoms then moved the Supreme Court, which stayed the interim order on compensatory tariff and asked the Aptel to decide the matter as expeditiously as possible.

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