APERC Rules In Favor Of Solar Plant Operator In 30 MW Dispute Over Maintenance Charges In Andhra Pradesh

The case deals with a dispute involving Aurobindo Pharma Ltd, which operates a Solar Captive Generating plant, among other facilities. The petition arose due to a disagreement over the operation and maintenance (O&M) charges imposed by APTRANSCO on the company. Aurobindo Pharma had built a solar power plant with a capacity of 30 MW at Srikakulam, which was connected to the grid in 2017.

The key issue revolved around the charges demanded by APTRANSCO for maintaining the 132 kV transmission lines and bays, which had been installed and maintained by Aurobindo Pharma since the commissioning of the solar plant. Despite Aurobindo Pharma maintaining the lines and equipment, APTRANSCO claimed O&M charges for the period from 2017 to 2023, even though the company had already transferred the assets to APTRANSCO in May 2023 through a gift deed.

Aurobindo Pharma argued that the charges were unjustified because they had already been maintaining the lines and bays. They contended that APTRANSCO’s demand lacked legal backing and did not align with any contract or regulatory statute. Furthermore, they claimed that the O&M charges were not stipulated in the initial agreements for the solar plant’s connection to the grid. The company also referenced a similar case in which APERC had ruled that such maintenance charges were illegal.

APTRANSCO defended the charges, stating that the assets had only been transferred to them officially in 2023 and that they had maintained the lines and bays before the transfer. They also argued that these charges were standard practice based on specific regulations.

After reviewing the arguments, the Andhra Pradesh Electricity Regulatory Commission (APERC) ruled in favor of Aurobindo Pharma, declaring that APTRANSCO’s demand for O&M charges lacked legal authority. The Commission emphasized that no fiscal liability could be imposed without statutory support or contractual agreement. Consequently, APTRANSCO was ordered to refund the charges collected from Aurobindo Pharma within one month. However, APERC denied the company’s request for interest on the refunded amount.

This ruling highlights the complexities in the management of solar energy infrastructure and the importance of clear regulatory guidelines to avoid such disputes.