Electricity tribunal reprieve for R-Power's Sasan project

Anil Dhirubhai Ambani Group had appealed in APTEL against the regulator's order

The Appellate Tribunal for Electricity (APTEL) has provided relief to Reliance Power (RPower) in a dispute regarding the date of commissioning the company’s Sasan ultra mega power project (UMPP). The tribunal has set aside a June 20 order of the Central Electricity regulatory Commission (CERC) asking R-Power to start testing the project afresh.

After R-Power had approached APTEL against the order, the tribunal admitted the petition and asked CERC to hear the case again, on the grounds of maintainability of the petition filed by Western Region Load Dispatch Centre (WRLDC).

In its order on Monday, APTEL ruled the CERC order had violated the principles of natural justice. “The impugned order is set aside and the matter is remanded back to the central commission to decide the issues afresh, after hearing the applicant (R-Power) and other parties,” it said.

FRESH TURN OF EVENTS

2006
Reliance Power bags Sasan ultra mega power project
2007
Power purchase agreement signed with distribution companies in seven states
2013
March: First unit of 660 Mw-project synchronised; independent engineer issues commissioning certificate
April: Western Region Load Despatch Centre petitions the Central Electricity Regulatory Commission (CERC) questioning authenticity of the certificate, alleges R-Power declared wrong commercial parameters
May: CERC hears case, SPL raises issue of maintainability of petition, files submissions on maintainability, reserves right to reply on merits
June: CERC quashes certificate, asks R-Power to test the power unit afresh
Aug: The Appellate Tribunal for Electricity sets aside CERC order, asks regulator to hear case again

The two-member APTEL panel, with former Central Electricity Authority chairman Rakesh Nath as technical member, said it failed to understand why CERC had decided the matter hurriedly at the admission stage, without deciding the issue of maintainability raised by Sasan Power Ltd (SPL), the R-Power subsidiary implementing the Sasan project. While setting aside the CERC order, the tribunal clarified it hadn’t examined the regulator’s ruling on merits and wasn’t expressing any opinion on the issue.

R-Power had bagged the 3,960-Mw Sasan UMPP in 2006 and had signed power purchase agreements with 14 distribution companies in seven states. The first unit of the project was synchronised in March this year. According to norms, an independent engineer had issued a certificate confirming the commissioning in March.

However, in April, power transmitter WRLDC approached CERC, questioning the authenticity of the certificate. It alleged R-Power had declared the achievement of commercial parameters in a wrong manner and this could impact R-Power’s rates of selling power. In R-Power’s test certificate, the company had said the commercial operation date was March 30.

If this test certificate was considered the basis of the commissioning date, the first year of operation for the power plant would be 2012-13, during which it secured about 70 paise a unit, said a government official, on condition of anonymity. The rates would be the same for the second year, too. But from the third year, the rates would rise about 70 per cent.

RPower challenged WRLDC’s petition on the grounds of maintainability, arguing the transmitter’s job was limited to scheduling start-up power. The company had reserved its right to submit a reply on the grounds of merits of the case.