SC stays APTEL’s order allowing hike in tariffs in Mundra Plants

The Supreme Court stayed an order by the Appellate Tribunal for Electricity (APTEL) allowing Adani Power Ltd and Tata Power Co. Ltd to charge higher prices for the electricity produced by them in their Mundra plants, Gujarat and issued a direction to APTEL to dispose of the matter speedily.

A bench headed by Justice JS Khehar while asking APTEL to decide the matter as expeditiously as possible also observed that senior counsel Harish Salve and Abhishekh Singhvi, appearing for “Tata and Adani have made a statements before the court that they will accept payments without prejudice in terms of the PPAs. Referring to the statements made by them, the impugned order of the tribunal is rendered as inoperative.

The Supreme Court also pulled up the Haryana electricity distribution companies which had sought stay on the APTEL’s order which validated compensatory tariff to Adani Power and Tata Power.

However, it was observed that, “on merits we are tentatively 100% with you. However, you participated in the committee set up to decide on compensating the firms (for higher cost of coal imports from Indonesia.) Hence, it doesn’t matter whether it is 5 paise or 54 paise.

Additional Solicitor General L Nageshwar Rao, appearing for Haryana discoms, contented that the contract was entered with the producers after competitive bidding and they are governed and bound by PPAs. “Any increase in tariff has to be passed on to the consumers and the difference is 54 paise per unit… I participated in the panel without prejudice as per the orders just to find a solution. You cannot hold it against me”, the senior counsel said.

Prior to APTEL’s interim order, CERC, way back in April, 2013 had allowed Adani Power and Tata Power to recover compensatory tariffs from five state discoms that have PPAs with power producers.