Judgment of Appeal No. 57 of 2020

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APPELLATE TRIBUNAL FOR ELECTRICITY AT NEW DELHI

(APPELLATE JURISDICTION)

APPEAL NO. 57 OF 2020

Dated : 01^st September, 2020

Present: Hon’ble Mrs. Justice Manjula Chellur, Chairperson

Hon’ble Mr. S.D. Dubey, Technical Member

IN THE MATTER OF :

Techno Electric & Engineering Company Limited

Represented through its General Manager,

Corporate Office: 1B, Park Plaza, South Block,

71, Park Street, Kolkata- 700016.

....Appellant

Versus

(i)

Central Electricity Regulatory Commission

Represented through Hon’ble Secretary.

3^rd& 4^th Floor, Chanderlok Building,

36, Janpath, New Delhi- 110001

(ii)

National Load Despatch Centre

Represented through its Executive Director

B-9 (1^st Floor), Qutab Institutional Area,

Katwaria Sarai, New Delhi- 110016

(iii)

Tamil Nadu Transmission Corp. Ltd.

Represented through its Chairman

144, Anna Salai, Chennai,Tamil Nadu

....Respondent(s)

Judgment of Appeal No. 57 of 2020

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Counsel for the Appellant (s) :

Mr. Amit Kapur

Ms. Poonam Verma

Mr. Saunak Kumar Rajguru

Mr. Sidhant Kaushik

Ms. Aparajita Upadhyay

Ms. Adishree Chakraborty

Ms. Sakshi Kapoor

Counsel for the Respondent(s) :

Ms. Abiha Zaidi for R-2/NLDC

Mr. S. Vallinayagam for R-3

J U D G M E N T

PER HON’BLE MR. S. D. DUBEY, TECHNICAL MEMBER

1.

The Appellant, Techno Electric & Engineering Company Limited

formerly Simran Wind Project Ltd. (“Simran”) has filed the present

Appeal challenging the findings of the Order passed by Central

Electricity Regulatory Commission (“CERC”) dated 28.01.2020 in

Petition No. 242/MP/2019 (“Impugned Order”) whereby the

CERC has failed to appreciate the impact of merger and

amalgamation of a holding company into its subsidiary company.

By doing so, CERC has wrongly deprived the Appellant of its

legitimate entitlement as a renewable energy generator.

1.1

Pursuant to the merger, the Appellant continues to be entitled to

Renewable Energy Certificates (“RECs”) as it was prior to the

merger as the merger resulted into change in name only and not

change in legal status. CERC wrongly treated it as change in legal

status.

Judgment of Appeal No. 57 of 2020

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1.2

The statutory framework in India mandates promotion of

renewable energy generation. The Electricity Act, 2003 (“Act”), the

policies framed under the Act, as also the National Action Plan on

Climate Change provide for a roadmap for increasing the share of

renewable energy in the total generation capacity in the country. In

States where there are avenues for harnessing the renewable

energy potential beyond the Renewable Purchase Obligation

(“RPO”) level fixed by the State Commissions, the high cost of

generation from renewable energy sources discourages the local

distribution licensees from purchasing renewable power beyond

the RPO level.

1.3

The concept of RECs assumes significance which seeks to

address the mismatch between availability of renewable energy

sources and the requirement of the obligated entities to meet their

RPO. RECs encourage the renewable energy capacity addition in

the States where there is potential for renewable energy

generation as the REC framework seeks to create a national level

market for such generators to recover their cost. In terms of

CERC’s approved procedure for redemption of RECs, non-solar

(wind) certificates are sold to obligated entities (viz. distribution

licensees etc.)to enable them to meet their RPO or to entities other

than obligated entities on voluntary basis. Such RECs are traded

through CERC’s approved power exchanges within the

forbearance price and floor price as determined by CERC from

time to time.

1.4

The Appellant, as a renewable energy generating company, is

entitled to obtain the RECs in terms of Central Electricity

Judgment of Appeal No. 57 of 2020

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Regulatory Commission (Terms and Conditions for Recognition

and Issuance of REC for Renewabl