The Central Electricity Regulatory Commission’s (CERC) decision to raise compensatory tariff for Tata and Adani Power, may affect distributions companies in the states, including Gujarat, Haryana, Rajasthan, Maharashtra, where these generation companies (gencos) provide power.
Speaking on the latest development, RG Gupta, Chairman, Rajasthan Vidyut Vitran Nigam, said their approach to CERC’s order will depend on the state regulator.
“We are still studying the CERC order and will keenly watch the binding principles in the order,” Gupta told to CNBC-TV18’s Latha Venkatesh and Sonia Shenoy.
“The issue here has to be decided by the Rajasthan Electricity Regulatory Commission (RERC). Already, there was a petition filed by M/s Adani Power, which has been once rejected. Now, they will again have to approach the regulator in view of the latest decision,” he added.
Gupta said that much depends upon the specific conditions under which the hike was allowed by the CERC and the kind of agreement that they had entered into with the power gencos.
The average cost of power in Rajasthan is Rs 3.60 per unit.
Adani supplies 1200 MW of power to Rajasthan, through two units. “These two plants are running in full capacity and are giving us around 3 crore units per day,” said Gupta.
Below is the interview of RG Gupta, Chairman of Rajasthan DISCOM with Latha Venkatesh and Sonia Shenoy on CNBC-TV18.
Latha: You have received the order itself, will Rajasthan be contesting it or simply passing on the hike?
A: No, in fact the issue here is to decide by the Rajasthan Electricity Regulatory Commission. Already there was a petition filed by Adani, which has been once rejected. Now, they will have to again approach their regulator in view of the latest decision of CERC.
Latha: Given the CERC’s agreement, would the RERC refuse it, will they not be obliged to grant Adani Power the hike that CERC has allowed them?
A: No, in fact much depends upon as to what are the specific conditions under which the CERC has allowed it, the kind of agreement that were entered into with those letter there. As far as Rajasthan is concerned, it is entirely state project, it is not inter-state sort of power transfer. Because it is state project, the entire issue is to be decided by the RERC and of course the guiding principles that have been led in the recent decision, they have some sort of a legal binding. That cannot be denied.
Sonia: Can you take us through what the exact issue or the contentious points are that the Rajasthan DISCOM has against the CERC’s recommendations?
A: We are still studying it but whatever is the decision, it hardly met us. In fact when you deal with the issue, with the regulatory commission, we come out with our own arguments and whatever is reasonable and this should be permitted in view of the coal price, which is being imported by the company and if it is not imported, they cannot generate power. So that is a situation in which on a reasonable ground, things have to be exceeded. I cannot deny it also simultaneously. But what I am trying to say is that ultimately the regulatory commission of Rajasthan will take a call on it and allow a tariff which will be paid by the state companies.
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