APTEL Rules Against Transferability of Banked Energy

In an order last week, the Appellate Tribunal for Electricity (APTEL) delivered a key judgement on the transfer of banked wind energy between two projects belonging to the same firm. The case was filed by steel maker Maharashtra Seamless Limited  versus the Maharashtra Electricity Regulatory Commission, Maharashtra State Electricity Distribution Co. Ltd., Maharashtra Energy Development Agency. Maharashtra Seamless is the flagship firm of the diversified DP Jindal Group, which counts Jindal Pipes as well as Jindal Drilling among group firms.

Key Points:

1. Background:
   • Maharashtra Seamless Limited (MSL) operates two industrial plants and a 7 MW Wind Energy Captive Power Plant (CPP).
   • MSL sought to adjust banked energy units from its Vile Bhagad plant to its Sukeli plant, which was denied by the Maharashtra Electricity Regulatory Commission (MERC).
2. Appeal:
   • MSL appealed against the MERC’s order rejecting their request for energy adjustment.
   • The appeal argued that the denial was unjustified and contrary to regulations.
3. Commission’s Findings:
   • The MERC found that each industrial plant is a separate consumer with distinct permissions and technical parameters.
   • The Commission upheld the denial of energy adjustment between the two plants.
4. Appellant’s Arguments:
   • MSL argued that the denial was based on an erroneous interpretation of regulations.
   • They claimed that the adjustment would not cause any loss to the Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL).
5. Respondents’ Arguments:
   • The respondents supported the MERC’s order, stating it was in line with the Electricity Act, 2003, and Open Access Regulations, 2005.
6. Tribunal’s Decision:
   • The Tribunal upheld the MERC’s decision, stating that the two plants are distinct consumers and the adjustment of energy units was not permissible.
   • The appeal was dismissed.

Besides setting a legal precedent for future cases involving a similar situation, the APTEL order might also force some industrial firms to rework their calculations, in case they were counting on following the same route as Maharashtra Seamless Limited.