No Relief For Greenyana At Aptel For Haryana Project

Recently, the Appellate Tribunal for Electricity (APTEL) has dismissed Greenyana Solar’s plea against Haryana Electricity Regulatory Commission’s (HERC) order, which denied the solar developer’s plant at Kurangawali connectivity to the state’s grid. Greenyana is a subsidiary of Cleantech Solar.

In 2018, Greenyana applied for connectivity to Haryana Vidyut Prasaran Nigam (HVPN) for its solar plant and 132 kV substation at Kurangawali at 33 kV voltage level for the purpose of captive supply of electricity from its 20 MW solar project.

In March 2019, HVPN issued ‘Final Guidelines regarding connectivity to solar power projects’ under the RE Regulations, under which the generators were asked to submit an undertaking clearly specifying the nature of the project. Greenyana submitted an undertaking in terms of the final guidelines mentioning the status of its power plant as ‘Captive’.

The Final Guidelines further provided that the applications for connectivity would be processed in two stages viz. In-Principle Feasibility and the Final Connectivity, and had also enumerated the procedure for each stage. The Final Guidelines also provided for submission of the following documents by the generator as a condition precedent for grant of Final Connectivity. In September 2019, HVPN granted final connectivity approval for Greenyana’s solar power plant on the basis of the Final Guidelines.

Upon the project’s completion, however, it was found that the plant did not fulfil all the requisite captive conditions, such as the requirements of demonstrating lock-in on shareholding of lead shareholder and lock in of 26% shareholding of captive users prescribed in Guidelines, resulting into the denial of final connectivity. The connectivity agreement, as per HERC’s order, was thus not signed, aggrieving Greenyana, which appealed the decision before APTEL.

The developer argued before the tribunal that the captive status of its plant should be judged at the end of each financial year after commencement of operations, even though it had availed the benefits under the captive category prior to this stage. APTEL was far from convinced with the argument, noting, “We note the finding of the State Commission that it is an admitted position that the Appellant [Greenyana] has made an application to HAREDA [Haryana Renewable Energy Development Agency] to set up a captive solar power plant and avail the benefits as provided under the solar policy. In view thereof, the Appellant cannot now escape from the rigors of the Solar Policy as well as HAREDA/HVPNL’s guidelines/clarification by contending that it is not required to demonstrate its captive status at this stage, as prescribed therein.”

“Therefore, the Appellant’s contention that the issue of connectivity and the captive conditions to be fulfilled have no correlation as per the provisions of the Solar Policy, cannot be accepted,” said the tribunal.

APTEL further noted that at the time of applying for the tender to HVPN, Greenyana had not decided on whether it would be a captive plant or an IPP solar generator. It later chose the ‘captive’ category to avail the benefits of the Solar Policy and secure seniority in the list of applicants for a priority for the grant of the project without there being any actual captive users until January 2020. “…another solar project developer i.e. AMP Solar Park Private Limited could only get in principle feasibility for 30 MW against an application for 50MW. Thus, the conduct of the Appellant also amounts to squatting on the scarce capacity available at the sub- station concerned,” stated the tribunal.

“We agree with the view of the State Commission [HERC] that the delay occurred in signing the connection agreement is not attributable to the Respondents and Appellant is not entitled to any compensation for the alleged losses suffered by it on account of non-signing of the Connection Agreement. The project is still not complete. Besides, the right of the Appellant for grant of compensation or recovery of projected loss is foreclosed by its own conduct in not complying with the conditions of the policy,” said APTEL.

In its petition to the tribunal, Greenyana had also submitted that HERC’s actions reeked of “institutional bias” of favouring the distribution licensees. The developer argued that appointing two officers of the contesting respondent in the case (the Discom) as ‘local commissioner’ to provide a report after the site visit of the plant is against the very basic principle of law that one cannot be a judge in its own case and violates the principles of natural justice.

APTEL agreed with Greenyana’s contention on this point, noting, “…in the interest of equity and justice the State Commission should have formed a team comprising of officers drawn both from the Appellant and the Respondent Discom. Secondly, copy of the report should also have been provided to the Appellant, to give them an opportunity to go through the report and make submissions, if any, on the report, to the State Commission. The State Commission being the regulator is required to be transparent, neutral and unbiased in all its actions. We observe that there has been a serious lapse on this account by State Commission while appointing the local Commissioners and not providing an opportunity to the Appellant to make submissions, on the report, to the State Commission. We expect the State Commission to be more careful in future in such matters and act in strict compliance as per law.”

However, the tribunal clarified that this was only a procedural lapse on HERC’s part and did not prove institutional bias. This procedural error could not have the effect of vitiating the commission’s decision since the facts found in the commissioner’s report stood independently confirmed before APTEL.

Therefore, the tribunal upheld HERC’s order and dismissed Greenyana’s appeal as being without any merit. No financial relief was granted to the developer either, though the commission did add, “…the Appellant has set up 10.72 MW and this capacity is stranded for want of connectivity thus causing financial hardship to the Appellant. We give liberty to the Appellant to approach the State Commission to seek connectivity for its plant outside the Solar Scheme, 2016 and expect the State Commission to consider such request, if submitted, and take appropriate action thereupon, promptly and in accordance with law.”