Indian Energy Sector Regulatory Updates from Central Govt Offices on 05.12.2023

NLDC?

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Link to today’s report :?https://report.grid-india.in/psp_report.php?

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Demand Met during Evening Peak hrs(MW) (at 19:00 hrs; from RLDCs)??->????163124 ??MW (Total)?

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Peak Shortage (MW)?-> 179 MW (Total)?

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Time Of Maximum Demand Met?-> 09:25 (All India)?

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IEX?

DAM MCP 96 Time Blocks?:?Max-> Rs 6500.41 /MWh;?Min-> Rs 2147.31 /MWh;?Avg-> Rs 3300.12 / MWh;?

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There are no Orders / Notifications from APTEL, MoP, CEA, MNRE ?on 05.12.2023.

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CERC

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Order dated 05.12.2023 in 725/MP/2020

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The petition IS filed by the National Load Despatch Centre (NLDC) under the Electricity Act, 2003. The petition concerns the issuance of Renewable Energy Certificates (RECs) to Weizmann Limited and Karma Energy Limited, and the subsequent investigation into alleged wilful misconduct and suppression of material information by the petitioners. The order includes details of the investigation, submissions by the NLDC and the respondents, and the analysis and decision of the Commission.

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The petition was filed by NLDC in compliance with the Commission’s order dated 27.01.2020 in Petition No. 61/MP/2019, which directed NLDC to investigate and prepare a report on the matter of wilful misconduct and suppression of material information by Weizmann Limited and Karma Energy Limited. The report submitted by NLDC includes details of the ownership and restructuring of the companies, their registration under the REC mechanism, and subsequent changes in name and ownership.

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NLDC submitted a report in compliance with the Commission's order in Petition No. 61/MP/2019. The report revealed that M/s Weizmann Limited and Karma Energy Limited belonged to the same group and had two wind energy projects. The two wind projects were commissioned in December 2000/March 2001/May 2001, and the commissioning certificate was issued by Maharashtra State Electricity Board. However, after a restructuring through a Scheme of Arrangements, the two subsidiaries of the group merged with the holding company. The demerger came into effect from April 01, 2010, and all assets and liabilities of the power business undertaking were transferred to the resultant companies. ( Any company producing renewable energy is eligible for registration for issuance of REC certificates under the REC Mechanism in its own name.)

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The respondents, Weizmann Limited and Karma Energy Limited, submitted their responses to the allegations, stating that the errors were inadvertent and not intended to mislead the authorities. They also provided details of the internal disciplinary proceedings taken against the employees responsible for the lapse.

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After hearing the submissions from both parties, the Commission directed the respondents to file an affidavit detailing the internal actions taken against the employees responsible for the lapse. The Commission then reserved the matter for further order.The Commission's decision is based on the findings of the investigation report submitted by NLDC, which concluded that the errors were unintentional and that the respondents had taken internal disciplinary actions against the employees responsible for the lapse. The Commission cautioned the respondents to be vigilant in the future and disposed of the petition accordingly.

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Link to Document: https://cercind.gov.in/2023/orders/725-MP-2020.pdf

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Order dated 05.12.2023 in 283/MP/2022 and 286/MP/2022

This petition is filed by JSW Renewable Energy Limited (JREL) seeking a declaration of "Change in Law" on account of a change in Goods and Services Tax (GST) slabs. The petition is related to Power Purchase Agreements (PPAs) executed between JREL and Solar Energy Corporation of India Limited (SECI) for the development, generation, and supply of electricity from wind power projects in Tamil Nadu. The petitioner has made specific prayers related to the change in GST slabs and are seeking reimbursement for the corresponding increase in project cost, along with interest/carrying costs.

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The Commission's analysis and decision focus on the issues raised in the petition, including whether the change in GST rates constitutes a "Change in Law" event under the PPAs, the discount rate for the calculation of compensation, and the entitlement to carrying costs. The Commission ultimately holds that the change in GST rates qualifies as a "Change in Law" event and that the petitioner is entitled to compensation for the increase in GST from 5% to 12%. The order also addresses the methodology for evaluating change in law claims and the impact of the change in law event on project cost. It concludes that the petitioner may approach the Commission separately for compensation once actual expenditure is incurred.

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Link to Document: https://cercind.gov.in/2023/orders/283-MP-2022-Ors.pdf

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