Maharashtra Electricity Regulatory Commission (MERC) has allowed wind power generators’ claim on delayed payments along with interest for energy supplied to the Maharashtra State Electricity Distribution Company (MSEDCL).
The Commission ruled that if MSEDCL failed to pay within the due date, the wind developers are entitled to the mechanism stipulated in the Late Payment Surcharge Rules for recovering its due amount.
Background
MERC had issued two orders in 2018 and 2019 directing MSEDCL to release payments to wind developers for the principal amount and delayed payment charges (DPC). Penalties for deviation from the payment plan included interest of 1.25% per month on delayed payment of DPC.
These orders were challenged by wind generators Sahyadri Industries (SIL), Shah Promotors and Developers (SPD), and Mahanagar Developers (MD) in the Appellate Tribunal for Electricity (APTEL), which found that MERC had not provided clear findings on the amount due and ordered them to determine the due amount including DPC and carrying cost.
The claims liabilities worked out by the wind generators are:
As per MSEDCL’s calculation, it owed SIL ₹4.40 million (~$54,086) in DPC for the period from January to September 2022, with no interest.
In the case of SPD, MSEDCL owed ₹35,000 (~$430) in DPC for July 2017, and ₹152,000 (~$1,868) for October 2017. MSEDCL claimed it did not owe any interest to SPD.
MSEDCL stated that it owed a principal amount of ₹120,000 (~$1,475) to MD for July 2017. The DPC worked out to be ₹8.9 million (~$109,396) for the period from April 2017 to June 2018. MSEDCL again claimed it did not owe any interest.
Commission analysis
The Commission ruled that MSDECL should pay Sahyadri Industries an interest of ₹15.42 million (~$189,578) and a DPC of ₹4.58 million (~$56,307).
The Commission worked out a DPC to the tune of ₹34,000 (~$418) for July -2017 and ₹147,000 (~$1,807) for October 2017 to be paid by MSEDCL to Shah Promotors and Developers. The Commission also ordered MSEDCL to submit an interest of ₹10,000 (~$122) to SPD.
The commission noted that MSEDCL must pay a principal amount of ₹118,000 (~$1,450), a DPC of ₹8.87 million (~$109,045), and an interest of ₹5.25 million (~$64,542) to Mahanagar Developers.
In an earlier order, the MERC ruled in favor of a wind power developer and said that it was eligible for a late payment surcharge for January 2017 and from April 2017 to February 2018 with an interest of 1.25% per month on the outstanding amount.
Last November, MERC directed MSEDCL to pay the principal amount to four wind project developers and clear the corresponding late payment surcharge due until the generation month of December 2020.
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Arjun Joshi is a staff reporter at Mercom India. Before joining Mercom, he worked as a technical writer for enterprise resource software companies based in India and abroad. He holds a bachelor’s degree in Journalism, Psychology, and Optional English from Garden City University, Bangalore. More articles from Arjun Joshi.
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