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2025 Supreme(Online)(CERC) 268
CENTRAL ELECTRICITY REGULATORY COMMISSION
Shri Jishnu Barua, CJ, Shri Ramesh Babu V., J, Shri Harish Dudani, J, Shri Ravinder Singh Dhillon, J
Approval under Regulation 86 of the Central Electricity Regulatory Commission (Conduct of Business) Regulations 1999 and Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations 2019 for the determination of transmission tariff from the date of commercial operation (COD) to 31.3.2024 for “Provision of Spare ICTs” in the Eastern Region. Power Grid Corporation of India Limited
Petition No. 187/TT/2024
For the Appellants/Petitioners: Shri Mohd. Mohsin, Shri Amit Yadav, Shri Ashish Alankar, Ms. Ashita Chauhan
For the Respondents:
The regulatory framework mandates thorough prudential checks on capital costs and defines responsibility for time overruns as controllable, influencing tariff determinations.
Headnote:(A) Central Electricity Regulatory Commission (Conduct of Business) Regulations, 1999; Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019 - Determination of transmission tariff for assets under commercial operation with approved capital cost. The petitioner sought approval for transmission tariff from the date of commercial operation to 31.3.2024. Issues of approval for capital expenditures, time overruns, and interest calculations were addressed. (Para 1, 9, 10, 16)
Findings of Court:
All claimed capital costs as on COD were allowed except for the disallowed costs attributed to delays in comments from beneficiaries and other factors. (Paras 41, 44)
Issues: Approval of capital costs, justification of time overrun, and calculation of annual fixed charges. (Paras 21, 27, 30)
Ratio Decidendi: Commodities defined under regulations require thorough prudential checks; delays attributable fittingly deemed controllable factors. (Paras 30, 39)
Result: Petition partially allowed; tariff approved for set operational dates.
| Table of Content |
|---|
| 1. petition filed for transmission tariff determination (Para 1 , 2 , 3) |
| 2. details of respondents and initial responses (Para 4 , 5) |
| 3. response clarifications regarding cost adjustments (Para 6 , 22) |
| 4. approval standards and procedures for tariff determination (Para 13 , 15) |
| 5. assessment of delay claims and justifications (Para 34 , 35 , 36) |
| 6. determination of capital costs and charges (Para 49 , 70) |
| 7. final order to approve annual fixed charges (Para 86 , 88) |
ORDER
The instant Petition has been filed by the Petitioner, Power Grid Corporation of India Limited, a deemed transmission licensee, for the determination of transmission tariff under the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019 (hereinafter referred to as “the 2019 Tariff Regulations”) from the date of commercial operation (COD) to 31.3.2024 in respect of the following assets (hereinafter referred to as “the transmission assets”) covered under “Provision of Spare ICTs” in the Eastern Region (hereinafter referred to as ‘the transmission project”):
Asset-1 : 01 No. 160 MVA, 400/220/132 kV Spare ICT at Baripada Sub-station (Regional Spare for Odisha)
Asset-2: 01 No 160 MVA, 400/220/132 kV Spare ICT at Daltonganj Sub-station (Regional Spare for Jharkhand).
Asset-3 01 No 500 MVA, 400/220 kV Spare ICT at Pusauli (Sasaram) Sub-station (Regional Spare for Bihar)
Asset-4: 01 No 500 MVA, 400/220 kV Spare ICT at Pandiabili GIS (Regional Spare for Odisha).
Asset-5: 01 No 500 MVA, 400/220 kV Spare ICT at Maithon Sub-station (Regional Spare for West Bengal).
2. The Petitioner has made the following prayers in the instant Petition:
“1) Approve the Transmission Tariff for the tariff block 2019-24 block for the asset covered under this petition, as per para -8.3 above.
2) Admit the capital cost as claimed in the Petition and approve the Additional Capitalisation incurred / projected to be incurred.
3) Approve the COD for the subject Assets and allow full tariff as claimed under instant petition.
4) Allow the petitioner to recover the shortfall or refund the excess Annual Fixed Charges, on account of Return on Equity due to change in applicable Minimum Alternate/Corporate Income Tax rate as per the Income Tax Act, 1961 (as amended from time to time) of the respective financial year directly without making any application before the Commission as provided in Tariff Regulation 2019 for respective block.
5) Approve the reimbursement of expenditure by the beneficiaries towards petition filing fee, and expenditure on publishing of notices in newspapers in terms of Regulation 70 (1) Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019, and other expenditure ( if any) in relation to the filing of petition.
6) Allow the petitioner to bill and recover Licensee fee and RLDC fees and charges, separately from the respondents in terms of Regulation 70 (3) and (4) Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019.
7) Allow the petitioner to bill and adjust impact on Interest on Loan due to change in Interest rate on account of floating rate of interest applicable during 2019-24 period, if any, from the beneficiaries.
8) Allow the Petitioner to bill and recover GST on Transmission Charges separately from the respondents, if GST on transmission is levied at any rate in future. Further, any taxes including GST and duties including cess etc. imposed by any statutory/Govt./municipal authorities shall be allowed to be recovered from the beneficiaries.
9) Allow interim tariff in accordance with Regulation 10(3) of Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019 for purpose of inclusion in the PoC charges. and pass such other relief as Hon’ble Commission deems fit and appropriate under the circumstances of the case and in the interest of justice.”
Background
3. The brief facts of the case are as under:
a. The transmission project was
