The Central Electricity Regulatory Commission (CERC) has cleared 25 of the 52 pending tariff order cases in the past three months.
"We have cleared 25 cases so far and the rest will also be cleared soon. Of the 25 cases, 17 belonged to transmission company PowerGrid Corporation while eight belonged to generation companies like National Thermal Power Corporation (NTPC)," CERC chairman A K Basu said here.
One of the significant orders related to the tariff for the Tanda power station of the Uttar Pradesh Power Corporation, in which NTPC had purchased the power station from the Uttar Pradesh Power Corporation as part of debt payments.
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NTPC and the Uttar Pradesh Power Corporation had decided the capital cost of the project at Rs 1,000 crore and sought the CERC's permission to accordingly determine fixed charges for the plant. The Uttar Pradesh Power Corporation had also approached the regulator for fixing the capital cost of the project.
According to a CERC order: "A transfer price, which is decided by two parties across the table with debt-dissolving approach, has both parties' interest in having a high transfer cost ---the seller willing to clear the maximum dues possible to the buyer and the buyer also taking the opportunity to reduce its irrecoverable debt."
"The transfer price based on such "debt-dissolving approach", cannot form the basis for determining tariff for the consumer," the CERC said, arriving at a capital cost of Rs 607 crore for the plant.
The CERC said accepting Rs 1,000 crore would be "anti-competitive." The revised price of Rs 607 crore for the Tanda power station was fixed by a special Bench of the CERC headed by K N Sinha.
The special Bench said the depreciation already recovered should be taken into account while setting tariffs and fixed charges.