Petition No. 159/MP/2012. Case: Coastal Gujarat Power Limited Vs Gujarat Urja Vikas Nigam Limited and Ors.. Central Electricity Regulatory Commission
| Case Number | Petition No. 159/MP/2012 |
| Judges | Dr. Pramod Deo, Chairperson, Shri S. Jayaraman, Member, Shri V.S. Verma, Member, Shri M. Deena Dayalan, Member, Shri A.S. Bakshi, Member (EO) |
| Issue | Electricity Act, 2003 - Sections 63, 79, 79(1)(f) |
| Judgement Date | October 25, 2012 |
| Court | Central Electricity Regulatory Commission |
Order:
(New Delhi)
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In this petition, filed under Section 79 of the Electricity Act, 2003 (the Act), the petitioner seeks the following relief:
(a) Establish an appropriate mechanism to offset in tariff the adverse impact of
(i) The unforeseen, uncontrollable and unprecedented escalation in the imported coal price and
(ii) The change in law by Government of Indonesia.
(b) Evolve a methodology for future fuel price pass through to secure to the Project a viable economic condition while building suitable safeguards to pass to Procurers benefit of any reduction in imported coal price.
(c) Pass such other order as the Hon'ble Commission may deem fit in the facts and circumstances of the present case.
Presently, we are examining the question of admission of the petition. Therefore, the brief facts necessary for this purpose are being considered.
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The petitioner was incorporated by Power Finance Corporation Ltd. as its wholly owned subsidiary in order to carry out the international competitive bidding to select a successful bidder in accordance with the competitive bidding guidelines (Bidding Guidelines) issued by the Central Government under section 63 of the Electricity Act, 2003 (the Act). Mundra Ultra Mega Power Project (the Project), with a total capacity of 4000 MW at Mundra in the State of Gujarat, was conceived by the Central Government for operation based on imported coal for supply of power to the States of Maharashtra, Gujarat, Rajasthan, Punjab and Haryana. On 31.3.2006, the petitioner, as a shell company, invited bids in accordance with the Bidding Guidelines for execution of the Project on Build, Own, Operate and Maintain basis. Tata Power Company Ltd which submitted its bid on or around 7.12.2006 was declared as the successful bidder with equivalent levelised tariff of ` 2.26367/kWh and the Letter of Intent dated 28.12.2006 was issued in favour of Tata Power Company Ltd. Subsequently, Tata Power Company Ltd acquired the entire stake in the petitioner. Thus, the petitioner is presently the wholly owned subsidiary of Tata Power Company Ltd. After its takeover by Tata Power Company Ltd, the petitioner executed the Power Purchase Agreement ("PPA") dated 22.4.2007 with the procurers, which have been impleaded as Respondent Nos. 1 to 7, with Gujarat Urja Vikas Nigam Ltd being the Lead Procurer.
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The tariff discovered in the process of competitive bidding was adopted by this Commission in its order dated 19.9.2007 in Petition No 18/2007.
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The petitioner has stated that Tata Power Company Ltd participated in the bidding process by factoring the price of coal imported from Indonesia and quoted the tariff accordingly. Tata Power Company Ltd had therefore entered into Coal Sales Agreement dated 30.3.2007 with Indo-Coal Resources (Cayman) Limited for yearly supply of approximately 10.11 Million MT of coal for its generating stations, which included the coal requirement for the Project.
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According to the petitioner, Article 3.1.2 (v) of the PPA mandated the petitioner to execute a Fuel Supply Agreement ("FSA") within 12 months from the effective date, that is, the date of execution of the PPA. The petitioner has stated that the FSA dated 30.3.2007 with coal to be sourced from Indonesia was duly submitted to the first respondent on 18.12.2008.
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The petitioner has further stated...
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