Searching Case Laws & Precedent on Legal Query..!
Scanned Judgements…!
Searching Case Laws & Precedent on Legal Query..!
Scanned Judgements…!
Some judgments clarify that even if agreements are negotiated and signed, they are not enforceable unless approved by the ERC, highlighting the regulatory oversight role. ["Adani Green Energy (UP) Limited vs Karnataka Electricity Regulatory Commission & Ors - Appellate Tribunal for Electricity"], ["Punjab Energy Development Agency (PEDA) VERSUS Punjab State Electricity Regulatory Commission (PSERC) & Ors - Appellate Tribunal for Electricity"]
Analysis and Conclusion:
In the booming renewable energy sector in India, private solar power developers often enter into Power Purchase Agreements (PPAs) with government corporations or utilities. But a critical question arises: does a power purchase agreement between a private solar power developer and a government corporation require approval by the Electricity Regulatory Commission (ERC)? This issue is pivotal for ensuring legal validity, tariff compliance, and avoiding disputes. This post explores the regulatory landscape under the Electricity Act, 2003, drawing from key judgments and regulations to provide clarity.
While this information is based on established legal precedents, it is for general educational purposes only and not specific legal advice. Consult a qualified lawyer for your circumstances.
Power purchase agreements (PPAs) between private solar developers and government entities are not mere contracts; they fall under stringent regulatory oversight. The main legal finding is that such PPAs typically require prior approval from the ERC for tariffs and key contractual terms to be legally valid and enforceable. This stems from the Electricity Act, 2003, which prioritizes transparency, consumer protection, and public interest. KKK Hydro Power Limited VS Himachal Pradesh State Electricity Board Limited - 2025 0 Supreme(SC) 1284
Without ERC nod, unilateral modifications, waivers, or deviations—especially those affecting tariffs—are invalid and challengeable in court. KKK Hydro Power Limited VS Himachal Pradesh State Electricity Board Limited - 2025 0 Supreme(SC) 1284 The framework ensures tariffs are set transparently, often via competitive bidding, preventing arbitrary changes. ALL INDIA POWER ENGINEER FEDERATION VS SASAN POWER LTD. - 2016 8 Supreme 439
The Electricity Act, 2003, is the cornerstone. Section 86(1)(b) empowers the ERC to regulate electricity purchase and tariffs. Tariffs from PPAs must be approved by the ERC; deviations without prior approval are unlawful. KKK Hydro Power Limited VS Himachal Pradesh State Electricity Board Limited - 2025 0 Supreme(SC) 1284
In renewable energy contexts, the ERC's jurisdiction extends to tariffs, obligations, and PPA compliance. Commissioner Of Agricultural Income Tax, Kerala VS Plantation Corporation Of Kerala LTD. , Kottayam - 2000 8 Supreme 53 PPAs must align with the Act and its regulations, mandating ERC-determined tariffs before implementation. KKK Hydro Power Limited VS Himachal Pradesh State Electricity Board Limited - 2025 0 Supreme(SC) 1284
PPAs with government entities or utilities generally need ERC prior approval for validity. For instance, in one case, PPAs entered on 23.05.2016 were approved by the Karnataka Electricity Regulatory Commission (KERC) on 17.10.2016, highlighting the standard process. Bangalore Electricity Supply Company Limited (BESCOM). VS E. S. Solar Power Pvt. Ltd. - 2021 4 Supreme 120 Supplementary PPAs incorporating KERC-suggested modifications were also executed post-approval. Bangalore Electricity Supply Company Limited (BESCOM). VS E. S. Solar Power Pvt. Ltd. - 2021 4 Supreme 120
Courts have upheld this: Agreements without regulatory approval are invalid, as seen where the court emphasized mandatory prior approval for tariff modifications. KKK Hydro Power Limited VS Himachal Pradesh State Electricity Board Limited - 2025 0 Supreme(SC) 1284 Waivers reducing tariffs must similarly be ERC-approved.
Several judgments affirm ERC's role. In appeals before the Appellate Tribunal for Electricity (APTEL), issues like jurisdiction over PPAs were central. For example, in a matter involving Solar Energy Corporation, the PPA execution between respondents was scrutinized, with the State Commission's jurisdiction questioned—but ultimately reinforcing regulatory involvement. M/s Saurya Urja Company of Rajasthan Limited. vs Rajasthan Electricity Regulatory Commission & Ors. - 2021 Supreme(Online)(APTEL) 9M/s Saurya Urja Company of Rajasthan Limited.VersusRajasthan Electricity Regulatory Commission & Ors.
In Ayana Ananthapuramu Solar Private Limited v. Andhra Pradesh Electricity Regulatory Commission, the SERC's interference in a back-to-back PPA's trading margin was examined, underscoring ERC limits yet affirming oversight on key terms. SOLAR ENERGY CORPORATION OF INDIA LIMITED.VersusDELHI ELECTRICITY REGULATORY COMMISSION & Anr.SOLAR ENERGY CORPORATION OF INDIA LIMITED. vs DELHI ELECTRICITY REGULATORY COMMISSION & Anr. - 2021 Supreme(Online)(APTEL) 75
The Supreme Court, in interpreting PPA clauses, clarified that reductions in tariffs are permissible only under specific conditions like delays, but always within approved frameworks. It noted: Power Purchase Agreements (PPAs) were entered into between the parties on 23.05.2016. The Power Purchase Agreements were approved by Karnataka Electricity Regulatory Commission (KERC) on 17.10.2016. Bangalore Electricity Supply Company Limited (BESCOM). v. E. S. Solar Power Pvt. Ltd. and Others - 2021 Supreme(Online)(SC) 498Bangalore Electricity Supply Company Limited (BESCOM). v. E. S. Solar Power Pvt. Ltd. and Others - 2021 Supreme(Online)(SC) 1513
Another ruling stressed: The present consideration has to be ordered in tune with the above conclusions. Accordingly,-- a) the subject Power Purchase Agreements are regulated by the Commission as having its consent and are taken on record. Ecoren Energy India Private Limited VS State of Andhra Pradesh - 2022 Supreme(AP) 176 This binds parties to regulatory orders.
In Madhya Pradesh, a PPA for a 50 MW Solar PV project under the Solar Policy required compliance, with termination reviews dismissed absent fraud proof. M. P. Power Management Company Limited, Jabalpur VS Sky Power Southeast Solar India Pvt. Ltd. - 2020 Supreme(MP) 1218
Developers or utilities cannot unilaterally alter PPA terms, particularly tariffs. Courts invalidate such moves. KKK Hydro Power Limited VS Himachal Pradesh State Electricity Board Limited - 2025 0 Supreme(SC) 1284 Exceptions are rare; deviations must go through regulatory channels to protect interests. ALL INDIA POWER ENGINEER FEDERATION VS SASAN POWER LTD. - 2016 8 Supreme 439
For instance, in Gujarat, the Commission lacked inherent power to extend control periods or vary PPA tariffs outside statutory procedures. Gujarat Urja Vikas Nigam Limited VS Solar Semiconductor Power Company (India) Private Limited - 2017 7 Supreme 646 This aligns with Section 62 of the Act, where tariffs follow public consultation and cannot be arbitrarily revised.
In Jharkhand cases, deadlines for amended PPAs were extended pending ERC approval, showing flexibility but not waiver of approval. Adhunik Power & Natural Resources Limited VS Jharkhand State Electricity Regulatory Commission - 2018 Supreme(Jhk) 837
To mitigate risks:- Secure Prior Approval: Execute PPAs only after ERC approval of tariffs and terms.- Document Amendments: Seek formal ERC nod for any changes or waivers.- Comply with Regulations: Align with Electricity Act, 2003, and state-specific rules like those from KERC or MERC. Coal India Limited VS Vidarbha Industries Power Limited - 2019 Supreme(Del) 1690- Monitor Obligations: Adhere to renewable purchase mandates.
Government entities should enforce transparency, while regulators monitor for fairness.
Navigating India's renewable energy regulations demands diligence. Staying updated on ERC guidelines ensures smooth project execution and revenue security. For tailored advice, engage legal experts familiar with state-specific commissions.
#SolarPPA, #ERCApproval, #RenewableEnergyIndia
The Appellant’s reliance on the approval of the Government of India to the Co-Developer Agreement is misconceived……..” ... 6.3.2 That the Power Purchase Agreement ("PPA") has been executed between both Respondents No. 2 &3 and Solar Energy corp. ... The two issues which emerge in the instant Appeal for our consideration: - Issue No.1:-Whether the State Commission has the jurisdiction in the subject matter to adjud....
The Appellant’s reliance on the approval of the Government of India to the Co-Developer Agreement is misconceived……..” ... 6.3.2 That the Power Purchase Agreement ("PPA") has been executed between both Respondents No. 2 &3 and Solar Energy corp. ... The two issues which emerge in the instant Appeal for our consideration: - Issue No.1:-Whether the State Commission has the jurisdiction in the subject matter to adjud....
The Appellant’s reliance on the approval of the Government of India to the Co-Developer Agreement is misconceived……..” ... 6.3.2 That the Power Purchase Agreement ("PPA") has been executed between both Respondents No. 2 &3 and Solar Energy corp. ... The two issues which emerge in the instant Appeal for our consideration: - Issue No.1:-Whether the State Commission has the jurisdiction in the subject matter to adjud....
In the matter of M/s Panchakshari Power Projects LLP V. Karnataka Electricity Regulatory Commission & Ors. ... It is not disputed that the provisions of the Power Purchase Agreement (PPA) in Chenamangathihalli (supra) and the PPA’s in the present cases are in pari materia. ... The case of Azure Sunrise Private Limited v. Chamundeshwari Electricity Supply Corporation Limited & Anr. ... At the cost of repetition, ....
The interference by the State Electricity Regulatory Commission (“SERC”) in the negotiated trading margin in the back-to-back power purchase agreement (“PPA”) between the electricity generating company (“generator”) and power trading licensee (“trader”), on one hand, and power supply agreement (“PSA” ... Power from the Solar Energy Corporation India Limited (SEC....
In the matter of Ayana Ananthapuramu Solar Private Limited v. Andhra Pradesh Electricity Regulatory Commission & Ors. ... The interference by the State Electricity Regulatory Commission (“SERC”) in the negotiated trading margin in the back-to-back power purchase agreement (“PPA”) between the electricity generating ... Developer (seller of power#H....
The interference by the State Electricity Regulatory Commission (“SERC”) in the negotiated trading margin in the back-to-back power purchase agreement (“PPA”) between the electricity generating company (“generator”) and power trading licensee (“trader”), on one hand, and power supply agreement (“PSA” ... Power from the Solar Energy Corporation India Limited (SEC....
Power Purchase Agreements (PPAs) were entered into between the parties on 23.05.2016. The Power Purchase Agreements were approved by Karnataka Electricity Regulatory Commission (KERC) on 17.10.2016. ... Supplementary Power Purchase Agreements were entered into between the parties on 17.12.2016 incorporating the modifications suggested by the Karnataka Electricity Regulatory Commission#HL....
Power Purchase Agreements (PPAs) were entered into between the parties on 23.05.2016. The Power Purchase Agreements were approved by Karnataka Electricity Regulatory Commission (KERC) on 17.10.2016. ... to a decision taken by the State Government for development of 1200 MWA of Solar power to be implemented in 60 Taluks through private sector participation. ... Supplementary Power....
Power Purchase Agreements (PPAs) were entered into between the parties on 23.05.2016. The Power Purchase Agreements were approved by Karnataka Electricity Regulatory Commission (KERC) on 17.10.2016. ... to a decision taken by the State Government for development of 1200 MWA of Solar power to be implemented in 60 Taluks through private sector participation. ... Supplementary Power....
The present consideration has to be ordered in tune with the above conclusions. Accordingly,-- a) the subject Power Purchase Agreements are regulated by the Commission as having its consent and are taken on record; b) these Power Purchase Agreements and the parties thereto shall be bound by the legal consequences that may flow concerning each of them from the orders that may be passed or the directions that may be given in O.P.No.1 of 2017 and O.P.No.5 of 2017 on the file of this Commission; c) any and all incentives/conditions envisaged in the Articles of the Power Purchase Agreem....
3. It is not in dispute that the respondent is a Power Purchasing Company under the Electricity Act, 2003 and the petitioner is responsible for power procurement in the State of M.P. The Project involved two milestones, viz, (i) to achieve condition subsequent after signing of PPA, i.e. permission, procurement of land. That in furtherance to the Solar Policy for encouraging generation of Power through Solar Power Projects an agreement was entered between the Petitioner and Respondent on 18.08.2015 captioned as Power Purchase Agreement for setting up a 50 mw Solar Photovoltaic (PV) ....
h. Respondent No. 1 sought approval from Maharashtra Electricity Regulatory Commission (hereinafter referred to as ‘MERC’) for sale of power/Power Purchase Agreement for its unit I, to Reliance Infrastructure Limited- Distribution. i. Respondent No. 1 then sought approval for conversion from GCPP to IPP and the MIDC vide its letter dated 20.05.2013 approved the conversion. On 20.02.2013, the approval was denied by MERC as this would amount to changing the status from GCPP to IPP. g. Based on the recommendations of the SLC(LT), an LOA dated 24/25.06.2008 was issued by WCL in....
The time period for submission of approved supplementary Power Purchase Agreement was extended for all such persons including the petitioners considering the delay in getting the approval of supplementary Power Purchase Agreement from the appropriate electricity regulatory commission. which is involved in the present writ petitions, period for getting supplementary Power Purchase Agreement executed and approved by the appropriate electricity regulatory commission was prescribed to be 45 days. including the approved supplementary Power Purchase Agreement. Further as per e-au....
In the said case, this Court was faced with the substantial question of law viz. whether the tariff fixed under a PPA (Power Purchase Agreement) is sacrosanct and inviolable and beyond review and correction by the State Electricity Regulatory Commission. However, later the power producer found that the place from where the power was to be evacuated was at a distance of 23 kms. In that case, respondent No.1 thereon-power producer had entered into a PPA with the appellant therein-distribution licensee for sale of electricity from the generating stations to the extent of the c....
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