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2016 Supreme(Online)(Guj) 4

GUJARAT HIGH COURT
Anant S. Dave, J
Hindalco Industries Limited – Appellant
Versus
Gujarat Electricity Regulatory Commission – Respondent
Special Civil Application No.171 of 2011 | Special Civil Application No.558 of 2011 | Special Civil Application No.564 of 2011 | Special Civil Application No.597 of 2011 | Special Civil Application No.791 of 2011 | Special Civil Application No.936 of 2011 | Special Civil Application No.7084 of 2011 | Special Civil Application No.8027 of 2011 | Special Civil Application No.10471 of 2013



Advocates:
For the Appellants/Petitioners: Mr. Mihir Thakor, Mr. Percy Kavina, Mr. S.N. Soparkar, Mr. R. S. Sanjanwala, Mr. Mihir Joshi
For the Respondents: Shri Kamal Trivedi, Mr. Bhargav Karia

Regulations mandating captive power plants to purchase renewable energy are lawful under the Electricity Act, promoting environmental sustainability without violating constitutional rights.

Headnote:(A) Electricity Act, 2003 - Sections 7, 9, 86(1)(e) and 181 - Compliance with Renewable Purchase Obligation (RPO) - Gujarat Electricity Regulatory Commission issued Regulations mandating captive power plants to purchase electricity from renewable sources, challenged by various manufacturers as ultra vires, discriminatory, and unconstitutional - Claimed violation of Articles 14 and 19(1)(g) of the Constitution. (Paras 1-3, 11-13)

(B) Jurisdiction - Regulatory Authority’s power to impose obligations upon entities without license but operating captive generating plants was upheld - Regulatory Commission's obligation to promote both co-generation and renewable energy under sections of the Electricity Act and supporting National Electricity Policy. (Paras 20-26)

(C) Legal Interpretation - The court stressed the interpretation of 'total consumption' under Section 86(1)(e) to include captive power consumption, aligning with policy goals of environmental protection and sustainable energy. (Paras 24-25)

(D)

Result: Writ petitions dismissed; the imposition of RPO regulations found lawful and applicable.

Table of Content
1. challenge to the regulations based on jurisdiction. (Para 1 , 2)
2. description of the petitioners and their operations. (Para 3 , 4 , 5 , 6)
3. arguments against gerc's authority and interpretation of the act. (Para 8 , 9 , 10 , 14)
4. counterarguments by the respondent supporting the regulations. (Para 11 , 12)
5. court's interpretation of s.86(1)(e) and its implications. (Para 18 , 19 , 20)
6. final ruling dismissing all petitions. (Para 25 , 26)

1. In all these nine petitions, the petitioners challenge the order dated 17.4.2010 and the regulations issued vide notification dated 17.4.2010, namely, the Gujarat Electricity Regulatory Commission (Procurement of Power from Renewable Sources] Regulations, 2010 (hereinafter referred to as 'the Regulations'] passed by the respondent, Gujarat Electricity Regulatory Commission, as being without jurisdiction, discriminatory, ultravires the Electricity Act, 2003 , amounting to unreasonable restriction and violative of Art.14 and Art.19(1)(g) of the Constitution of India. By the impugned order, the Gujarat Electricity Regulatory Commission, in exercise of power under S.86(1)(e) of the [for short, 'the Act'], has mandated all the petitioners, who are having 'captive power plant'[CPP] or 'captive generating plant'[CGP], to purchase electricity (in kWh) from renewable energy sources at a defined minimum percentage of their total consumption during a year, by treating them as 'Obligated Entities' and bringing them within the purview of 'Renewable Purchase Obligation'.

2. The common issue raised in all these petitions is based on interpretation of S.86(1) (e) with other provisions of Electricity Act, 2003 , Rules and Regulations, etc.

3. Details of the activities of the petitioners are as under:
Hindalco Industries Limited, petitioner of Special Civil Application No.171 of 2011, has set up a mega Greenfield copper smelting and refining. It produces copper cathodes and continuous cast copper rods. It has total capacity of the smelter upto 5 lakh tons per year at single location at Dahej.
Grasim Industries Limited, petitioner of Special Civil Application No.558 of 2011, is engaged in manufacture of cellulosic fibers. It has captive power plant unit i.e. Birla Cellulosic, at Kosamba, Dist: Bharuch.
Aditya Birla Nuvo Limited, petitioner of Special Civil Application No.564 of 2011, is engaged in manufacture of viscose filament yarn, caustic soda. It has captive power plant at Veraval.
Ultratech Cement Limited, petitioner of Special Civil Application No.597 of 2011, is engaged in manufacture of cement at Kovaya, Dist: Amreli and is having a number of units of CPP of different capacity under operation.
Reliance Industries Limited, petitioner of Special Civil Application No.791 of 2011, is engaged in oil refinery business at Jamnagar.
Arvind Limited, petitioner of Special Civil Application No.936 of 2011, is engaged in the business of textiles and clothing having multi product textile facility at Naroda road, Ahmedabad.
DCM Shriram Consolidated Limited, petitioner of Special Civil Application No.7084 of 2011, has a division at Bharuch in the name of Shriram Alkali & Chemicals. It is engaged in the business of manufacturing chloralkali products viz. caustic soda, chlorine, hydrogen and hydrochloric acid at its unit at Bharuch.
United Phosphorus Limited, petitioner of Special Civil Application No.8027 of 2011, is in the business of producing chloro alkalies and agro chemicals, at Jhagadia, Dist: Bharuch.
Nirma Limited, petitioner of Special Civil Application No.10471 of 2013, is engaged in the business of manufacturing soaps and detergent, soda ash, caustic soda, salt and pharmaceuticals. It has 6 units / divisions in Gujarat.








4. Admittedly, the petitioners are running various manufacturing plants in the State of Gujarat and they have, as a vital step towards making the plants self - sufficient in their energy requirements and for uninterrupted supply of power, installed 'captive power


















































































































































































































































































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