CERC Rejects Azure’s Plea for Extension of LTA Start Date, Exemption from Transmission Charges

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The CERC has quashed the petition of Azure Power and its subsidiaries Azure Power Forty-Three, Azure Power Forty-One and Azure Power Maple, which sought the extension of the long term access start date. The petition also pleaded for extension of deadline from completion of the dedicated transmission line and pooling substation and exemption from transmission charges.

The subsidiaries of the firm were assigned the Long Term Access (LTA) for a total capacity at 1200 MW for supply of power generated from its three power projects. The solar power projects were all based in Rajasthan districts for 600 MW, 300 MW and 300 MW.  The 600 MW and both the 300 MW projects were won in the competitive bidding process for tenders floated by SECI.

The firm had filed a request for the Commission to ask the Power Grid Corporation of India Limited, Central Transmission Utility of India Limited and Powergrid Khetri Transmission Limited to extend the deadline for completion of the dedicated transmission line and pooling substation. The petition also requested for the extension of date of operationalization and start date of Long Term Access granted to Azure Power India Private for all the projects.

Azure Power had also requested the intervention of Ministry of Power for the waiver of the ISTS charges and losses for the time gap between the LTAA operationalization date and PPA SCOD.

As per the CERC, there is no relation between the project SCOD and the LTA commencement date as per the the LTA agreement. The Commission thus concluded that the contention of the firm is misplaced. Further, (Sharing of Inter-State Transmission Charges and Losses), Regulations, 2020 (2020 Sharing Regulations), the firms and subsidiaries are liable to pay transmission charges and cannot be granted exemption as per the regulatory framework. If Azure Power is granted exemption from transmission charges, it will have to be adjusted from the common pool (PoC). As a result, the interests of other parties involved may have to face the brunt by sharing the charges that are to be paid up by the  firm.

Formerly, Azure Power and its subsidiaries were granted relief through extensions in timelines due to the pandemic. Earlier last year, the Commission had allowed GST compensation on O&M expenses To Azure Power entities and other firms.