JUDGMENT

Swatanter Kumar, J. —

1.Andhra Pradesh Electricity Regulatory Commission (for short ‘Regulatory Commission’) was created in furtherance to the provisions of the Andhra Pradesh Electricity Reform Act, 1998 (hereinafter referred to as the ‘Reform Act, 1998’) enacted by the State legislature which received the assent of the President on 21st December, 1998 and became effective w.e.f. 1st February, 1999. The Commission initiated suo motu proceedings for determination of tariff applicable to the Non-Conventional Energy generation projects of Andhra Pradesh, which was to take effect from 1st April, 2004 onwards. After hearing the Non-Conventional Power Project Developers, the Non-Conventional Energy Development Corporation of Andhra Pradesh Ltd. and Transmission Corporation of Andhra Pradesh Ltd. (for short referred to as ‘NEDCAP’ and ‘APTRANSCO’ respectively), the Regulatory Commission, vide its detailed order dated 20th March, 2004, arrived at certain conclusions and fixed the energy purchase rates at base unit price of Rs. 2.25 as on 1st April,1994 and the escalation index of 5% p.a., but the escalation would be simple and not to be compounded every year. In other words, the ba