Ultratech To Not Pay Unnecessary Charges For Captive Solar Plant: RERC

CERC Orders Compensation To NTPC Over 'Change Of Law' Event

The Rajasthan Electricity Regulatory Commission (RERC) in its latest judgement exempted Ultratech and its Special Purpose Vehicle (SPV)-Amplus Dakshin Private Limited (ADPL) against payment of cross subsidy, water cess and other charges for a captive solar plant based in Rajasthan. 

As per the petition of Ultratech Cement Limited (UTCL), ADPL was incorporated as a SPV by its promotor Amplus Energy Solutions Pvt Ltd (AESPL) to setup captive generating plant for UTCL. AVVNL was the local discom in the area. In the petition UTCL said that it owns and operates Aditya Birla Cement Works in Chittorgarh in Rajasthan with a capacity of 77.18 MTPA. It also installed onsite solar captive plant with the help of ADPL and AESP of 8 MW capacity.

As per the agreement, ADPL was bound to install the solar CGP of 8MW on captive mode, UTCL owned 26 percent equity share in ADPL and AESPL owned 74 percent. UTCL was mandated to maintain the equity investment in ADPL and consume 100 percent of the power generated from the captive solar plant. 

The petitioner said that on August 3, AVVNL levied cross subsidy charges, additional charge and water access on the power consumed by the UTCL from the captive solar plant by holding that the solar captive plant by holding that UTCL was not a captive user. In its petition before the RERC, Ultratech said pleaded to exempt these charges, which it said was against the norms. 

In its final judgement in the case, the RERC ordered in favour of Ultratech and declared it a captive power consumer and asked AVVNL to return the charges it collected from the petitioner. 

“UTCL is having 26% ownership in the plant and consuming 100% of energy generated. UTCL is fulfilling both the conditions prescribed under Rule 3. AESPL, although, owns 74% in the CPP but consumes 0% , does not have any effect on the qualification of UTCL as captive consumer. UTCL qualifies as a captive consumer and entitled for the benefits provided to a captive consumer under the act/Rules/Regulations i.e. UTCL being captive consumer shall not be liable to pay Cross Subsidy Surcharge (CSS) and Additional Surcharge (AS) on the captive consumption from the plant. So far as Water Cess is concerned, this doesn’t fall in the purview of the Commission as it is governed by orders of the State Government.” the RERC order said.

It also added, “The petitioner UTCL shall not be liable to pay Cross Subsidy Surcharge (CSS) and Additional Surcharge (AS) on the captive consumption from the plant since commissioning of the plant. For the amount recovered on account of CSS and AS, if any, from the petitioner, the Discom is directed to refund such amount in 06 equal monthly instalments.”