HC asks private gencos to move CERC for relief

Written by Kaushal shroff | New Delhi | Updated: Apr 2 2014, 03:30am hrs
After NTPC, the Association of Power Producers (APP), an organisation that includes Tata Power, Reliance Power and the Adani Group, on Monday moved the Delhi High Court against the Central Electricity Regulatory Commissions (CERCs) new five-year tariff regulations.

The representative body, in its petition, has argued that the new guidelines unjustifiably impose such conditions that are either impossible to satisfy or can be met only at the cost of severe detriment to the business of the private power project developers.

APP is a body of majority of the private power project developers (currently 29 developers) in the country who constitute over 90% of the existing and planned power capacity in the private sector.

The new CERC regulations will come into effect on April 1 and will remain in force till March 31, 2019.

Earlier on March 19, NTPC had unsuccessfully moved the Delhi High Court seeking a stay on the new CERC tariff regulations. The high court, acting on NTPC's plea, had refused to grant a stay on the guidelines which the PSU argued would hit it badly and had directed CERC to consider representations made by the PSU against the tariff regulations.

Repeating its earlier order, the high court on Monday also directed APP to make representations against the new guidelines before the CERC.

For now, the plea of APP has been put up for further hearing in the court on May 19, along with NTPC's plea.

The petition filed by APP states that the tariff regulations issued are ultra vires of the Electricity Act, the tariff policy issued by the central government and claims that they are even otherwise arbitrary, unfair and discriminatory and are therefore in violation of the Constitution.

Primary amongst the demand raised by APP is that the Gross Calorific Value (GCV) of coal for recovery of variable charges should be on as fired basis and not on as received basis.

Additionally, APP has demanded that auxiliary energy consumption and secondary oil consumption should not be reduced and should be kept at previous levels. Further, it has also argued that the reduction of the Gross Station Heat Rate under the new regulations is arbitrary and unreasonable.

It adds that the provision of the regulations adopting as received as the basis for measuring the GCV for coal is grossly arbitrary, adding that the GCV of coal reduces from the time it is received till it is fired in the boiler due to a host of reasons including crushing of coal, sprinkling of water, storage in stock yard, removal of stones and boulders.