CERC Orders Payment For 250 MW Solar Project Compensation

The Central Electricity Regulatory Commission (CERC) has ruled in favor of Solairepro Urja Private Limited in a long-standing dispute over unpaid compensation. The case, Petition No. 517/MP/2024, involved NTPC Limited and Andhra Pradesh distribution companies (APDISCOMs) failing to comply with an earlier order issued in January 2024.

The dispute arose when Solairepro sought compensation for “Change in Law” events, specifically the Safeguard Duty imposed on imported solar modules. Although the Commission had already recognized the developer’s entitlement, the developer said NTPC had not begun reconciling the costs even six months after the required documents were submitted. Reconciliation is a necessary step before payment can be made.

The delay was largely due to disagreements between NTPC and the APDISCOMs. NTPC argued it was only an intermediary and could not release payment until the distribution companies verified the claims. The APDISCOMs, however, raised objections over the plant’s “AC/DC ratio.” They noted that while the contracted capacity was 250 MW, the developer had imported panels for around 350 MW and sought compensation for the higher amount.

Solairepro clarified that installing higher DC capacity than the AC output is standard practice in the solar industry. This ensures a consistent AC output of 250 MW. The configuration was approved by local electrical inspectors and followed Ministry of New and Renewable Energy (MNRE) guidelines.

CERC ruled that NTPC’s obligation to pay the developer is not conditional on receiving funds from APDISCOMs. The Commission criticized the excessive delay and directed all parties to complete the reconciliation within 30 days. NTPC has been instructed to pay the reconciled claims, including a late payment surcharge, through supplementary invoices within 45 days.

If NTPC or the APDISCOMs fail to comply, Solairepro Urja can approach the Commission again to initiate formal action under Section 142 of the Electricity Act. The ruling emphasizes the importance of timely compliance with regulatory orders and reinforces the rights of solar developers to receive compensation for recognized Change in Law events.

This decision highlights accountability and prompt resolution in India’s renewable energy sector, addressing challenges developers face when multiple intermediaries are involved in large solar projects.