CERC Dismisses SECI’s Appeal On ₹0.07/kWh Trading Margin For 150 MW/300 MWh BESS Project, Corrects Misattribution In Order

The petition brought by the Solar Energy Corporation of India Limited (SECI) to review the order dated May 16, 2024, was deliberated by the Commission. This petition revolves around the 150 MW/300 MWh Battery Energy Storage Systems (BESS) project connected to the Northern Region’s Fatehgarh-III substation.

SECI sought a review on three primary fronts. First, it requested clarification on trading margins, specifically ₹0.07/kWh for facilitating operations such as charging and discharging of the BESS for Grid Ancillary Services. SECI argued that this trading margin compensates for the intermediary services offered in the procurement and sale of electricity, distinguishing it from the existing 0.5% capacity charge-related trading margin. They claimed this additional margin was justified and previously acknowledged during discussions with the National Load Despatch Centre (NLDC).

Second, SECI flagged an error in the earlier order, where the trading margin was incorrectly attributed to the BESS Developer instead of SECI. They sought its correction to avoid ambiguity and ensure their role as the entitled intermediary was accurately reflected.

Third, SECI petitioned for condonation of a minor procedural delay (11 days) in filing the review. They attributed the delay to logistical challenges and consultation requirements.

During hearings, NLDC indicated its non-objection to SECI’s claims regarding the trading margin and acknowledged prior agreements on the ₹0.07/kWh rate for facilitating Grid Ancillary Services. However, the Commission’s analysis concluded that SECI did not present compelling evidence or novel information warranting a review of the earlier decision. It was observed that the ₹0.07/kWh trading margin was not a mandatory element of the BESS project’s financial framework, and double payment concerns were flagged under regulatory guidelines.

On the issue of the misattribution in the prior order, the Commission acknowledged the mistake and amended the relevant sections to correctly name SECI as the recipient of the trading margin.

Ultimately, while SECI’s delay in filing the petition was condoned, the Commission upheld its earlier stance that the ₹0.07/kWh trading margin was not essential and dismissed SECI’s appeal on this count. This decision underscored the importance of cost optimization in the power sector and adherence to statutory frameworks to avoid unnecessary financial burdens.