The Appellate Tribunal for Electricity (Aptel) has directed Tangedco and the Tamil Nadu State Load Despatch Centre to jointly pay compensation to solar energy developers for curtailment of generation from March 1 to June 30, 2017.

The tribunal had asked the Power System Operation Corporation Ltd. (POSOCO) to prepare a report on the issue.

Based on the report, it concluded that the curtailment instructions were issued for reasons other than grid security and fixed the compensation at 75% of the tariff per unit as per the power purchase agreements.

The order was delivered on an appeal filed by the National Solar Energy Federation of India, a non-profit organisation. The federation had moved the Tamil Nadu Electricity Regulatory Commission (TNERC) and sought compensation for the capacity which could not be utilised and power supplied due to backing down instructions.

Plea rejected

The TNERC rejected the plea, saying there was no provision for it in the power purchase agreements. The tribunal agreed with the TNERC’s view that that there was no provision for compensation in the power purchase agreements.

However, it said the back down instructions were issued for commercial reasons, which was evident from the finding in the POSOCO report that the solar generators with per unit cost of ₹7.01 were curtailed more. Arbitrary curtailment resulted in solar generators failing to repay their loans, and thus they were entitled to compensation.

The tribunal directed POSOCO to conduct a similar exercise till October 31, 2020, and submit a report to the TNERC within three months. The TNERC was asked to allow compensation for the backed down energy at the rate of 75% of the tariff fixed in the power purchase agreement, after considering the curtailment quantum based on the POSOCO report. The compensation for the entire period would be paid along with 9% interest, the tribunal said.

It said for curtailment of renewable energy for reasons other than grid security, a compensation at tariff per unit as per the power purchase agreement would be paid in future based on the report from the POSOCO. This methodology would be adopted till such time the Forum of Regulators or the Union government formulates guidelines in relation to curtailment of renewable energy.

Source: The Hindu