SC rejects Jindal plea in tribunal case

The Supreme Court has dismissed a petition by Jindal Steel and Power challenging the Appellate Tribunal for Electricity's order asking it to buy 5 per cent of the power generated from renewable sources.

A bench headed by Justice H K Sema asked the company to file a review petition before the tribunal, but refused to give any relief.

Jindal Steel, while seeking an exemption from purchasing the power, had stated that it had a surplus and such mandatory orders should be imposed only on those licensees which were power deficient.

It is totally unjust to direct the appellant to purchase more power when it is already surplus," it said.

Senior counsel Nageshwar Rao, appearing for Jindal, contended that any increase in the power procurement cost would affect the rate fixed for power supply to consumers, with whom the company had long-term fixed contracts.

Jindal, which has an integrated steel plant in Raigarh, has entered into long-term agreements with certain industries for supply of around 290 mw power at fixed rates of Rs 2.50 per unit, which is much lower than the rates charged by the state electricity board for industrial consumers.

To promote the generation of electricity from renewable sources, Chhattisgarh State Electricity Regulatory Commission (CSERC) had made it mandatory for all distribution licensees "" Jindal Power, Chhattisgarh State Electricity Boards and Bhilai Steel Plant "" to purchase 5 per cent of the power generated from biomass-based plants in November 2005.