In a groundbreaking move, the Central Electricity Regulatory Commission (CERC) has addressed the petition filed by M/s Wardha Solar (Maharashtra) Private Limited (WSMPL) and M/s Parampujya Solar Energy Private Ltd. (PSEPL) against the Karnataka State Load Despatch Centre (KSLDC). The petition, invoking specific regulations, sought enforcement of the ‘must run’ status granted to solar power projects and called for a halt to the issuance of backing down instructions by the SLDC (State Load Dispatch Centre).
The petitioners, collectively referred to as the Petitioners, highlighted their status as generating companies with nine solar PV power projects in Karnataka, secured through a competitive bidding process conducted by the Solar Energy Corporation of India (SECI). The dispute arose due to the alleged arbitrary backing down of power by KSLDC, prompting the Petitioners to seek regulatory intervention.
The heart of the matter lies in the ‘must run’ status accorded to renewable energy projects, as per the Indian Electricity Grid Code (IEGC) and the Karnataka Electricity Grid Code (KEGC). The Petitioners argued that the curtailment of solar power from their projects contradicted these regulations, leading to financial losses.
The CERC took note of the Ministry of New and Renewable Energy’s (MNRE) directive, emphasizing the ‘must run’ status for solar and wind power plants unless there are genuine grid safety concerns. The Petitioners contended that KSLDC’s actions, specifically telephonic backing down instructions, were in violation of MNRE’s guidelines.
Furthermore, the Petitioners cited the Grid India Ltd. (former Power System Operation Corporation Limited’s (POSOCO)) analysis, conducted at the direction of the CERC, which indicated that curtailment was not solely due to grid security reasons. The CERC, relying on the methodology endorsed by the Appellate Tribunal for Electricity (APTEL), ruled that the Petitioners are entitled to compensation for the period before and after APTEL’s judgment.
For the period before the APTEL judgment on August 2, 2021, during which curtailment occurred for reasons other than grid security, the CERC mandated compensation at 75% of the Power Purchase Agreement (PPA) tariff per unit within 60 days. Additionally, the Respondents are directed to pay 9% interest for the entire period. For the period after the APTEL judgment, curtailment will be compensated at the PPA tariff.
The CERC underscored the importance of promoting renewable energy and the ‘must run’ status granted to it. The decision sets a precedent for compensating renewable energy generators for curtailment due to reasons other than grid security, providing a clear framework for such situations.
This ruling aligns with the CERC’s commitment to fostering renewable energy development and ensuring fair compensation for generators facing unwarranted curtailment, thereby promoting a sustainable and robust energy ecosystem in the country.