SECI Wins Appeal Against Kerala State Commission's PSA Modifications In 300 MW Solar Power Dispute

Introduction

Solar Energy Corporation of India (SECI) recently emerged victorious in an appeal against the Kerala State Commission’s modifications to a power supply agreement (PSA) for a 300 MW solar power project.

The Kerala State Electricity Regulatory Commission (KSERC) had earlier modified the PSA, leading to a dispute between SECI and the project developer, Acme Solar Holdings.

Background of the Dispute

In 2015, SECI awarded Acme Solar Holdings the contract to develop the 300 MW solar power project in Kerala. The PSA stipulated a tariff of Rs. 5.49 per unit for 25 years.

However, in 2018, KSERC modified the PSA, reducing the tariff to Rs. 4.91 per unit. SECI challenged this modification, arguing that it violated the terms of the PSA and would result in financial losses for the company.

Appellate Tribunal’s Decision

The Appellate Tribunal for Electricity (APTEL) ruled in favor of SECI, setting aside the modifications made by KSERC.

The tribunal held that KSERC had erred in modifying the PSA without giving SECI a reasonable opportunity to be heard. It also found that the modifications were not in the public interest and would have adversely affected SECI’s financial viability.

Significance of the Ruling

The APTEL’s ruling is a significant development for the solar power sector in India. It reinforces the sanctity of PSAs and provides clarity on the regulatory framework for solar power projects.

The ruling also highlights the importance of ensuring that regulatory decisions are made in a fair and transparent manner, taking into account the interests of all stakeholders.

Conclusion

SECI's victory in this case is a positive step towards creating a stable and predictable regulatory environment for solar power projects in India. It is hoped that this ruling will encourage further investment in the sector and contribute to the country's renewable energy goals.