Gujarat Urja Vikas Nigam Limited vs Tarini Infrastructure Ltd.& Ors

2. A very brief resume of the relevant facts would be appropriate and would assist a determination of the question arising identified hereinabove.

The respondent No. 1 in Civil Appeal No. 5875 of 2012, namely, Tarini Infrastructure Ltd., is a power producer which has set up/installed two small hydro power projects in the State of Gujarat. In January, 2008 the respondent No. 1-power producer entered into a PPA with the appellant- distribution licensee for sale of electricity from the generating stations to the extent of the contracted quantity for a period of 35 years at Rs. 3.29 per KWH subject to escalation of 3% per annum till date of commercial operation. In March, 2010, just before commissioning of the generating station, the respondent power producer sought an increase in the tariff to Rs. 4.70 per unit on the ground that though under the Concession Agreement power was to be evacuated at the nearest sub-station at Rakholi under the jurisdiction of the Gujarat Electricity Transmission Company (GETCO) which was at a distance of 4 Kms from its switch yard, it was later realized that Rakholi was in Dadar Nagar Haveli. Consequently, the transmission line was required to be laid up to a point known as Mota Pondha which involved a total distance of 23 Kms. instead of the originally envisaged 4Kms. The additional infrastructure, admittedly, cost about Rs. 10 crores which was not envisaged in the Concession Agreement entered into between the respondent-power producer and Narmada Water Resources Department (respondent No. 2). In these circumstances, the power producer applied to the State Regulatory Commission for a redetermination of the tariff. The said request was refused by an order dated 03.09.2010, primarily, on the ground that once the tariff was determined and thereafter incorporated in the PPA there was no scope for redetermination of the same at the unilateral request of the power producer.

3. Insofar as Civil Appeal Nos. 1973-1974 of 2014 are concerned, the respondent-power producer, namely, Junagadh Power Projects Pvt. Ltd., has set up a biomass based power generation plant and had entered into a PPA with Gujarat Urja Vikas Nigam Limited (distribution licensee) on 26.11.2010. The tariff incorporated in the PPA was earlier approved by the State Regulatory Commission by tariff order dated 17.05.2010 on the basis of cost of biomass at Rs. 1600 per MT with escalation of 5% per annum for a period of 20 years of operation. The Biomass Energy Developers Association sought revision of the biomass fuel cost to Rs. 3000/- per MT and for consequential redetermination of the tariff. The said review petition was dismissed by the State Commission in November, 2010. Thereafter, the power producer, on its own, moved the State Regulatory Commission seeking modification of tariff on account of air cooled condenser and also seeking increase in the biomass fuel cost and consequential redetermination of the tariff on that basis. The State Regulatory Commission by its order dated 05.12.2010, while allowing an increase in tariff on account of air cooled condenser, rejected the request of the power producer to review the price of biomass fuel cost, primarily, on the ground that the review of the price of biomass fuel having been earlier rejected in the case of Biomass Energy Developers Association, the review of the said price at the request of the power producer cannot now be allowed.

Specifically in the case of Junagadh Power Projects Pvt. Ltd. (respondent No. 1 in Civil Appeal Nos. 1973-1974 of 2914) it is urged that the demand raised by Biomass Energy Developers Association for redetermination of the tariff by enhancing the fuel cost to Rs. 3000 per MT had been dismissed earlier and the issue has attained finality in law. The PPA stood novated to the extent of modification of tariff allowed on account of the issue of air cooled condenser is concerned and no further, it is urged. For clarity it may be noted that in an earlier proceeding a higher tariff had been allowed to biomass based power plants with air cooled condensers.

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19. In view of the above, the appeals are dismissed and the orders dated 31.05.2012 and 02.12.2013 of the Appellate Tribunal are affirmed. In the facts and circumstances of the case, the parties are left to bear their own costs.

[PRAFULLA C. PANT] NEW DELHI;

JULY 05, 2016.