The Appellate Tribunal for Electricity (APTEL) has upheld the Central Electricity Regulatory Commission’s (CERC) order refusing to adopt the tariff discovered through Solar Energy Corporation of India’s (SECI) tender for the 500 MW/1,000 MWh pilot battery energy storage system (BESS) project.

The Tribunal dismissed the appeals filed by SECI and JSW Renew Energy Five, a special purpose vehicle of JSW Energy. APTEL held that CERC was within its powers under Section 63 of the Electricity Act, 2003, to reject the tariff adoption on grounds of inordinate delays and a sharp fall in market prices that made the original tariff unaligned with prevailing conditions.

Background

The BESS pilot project dates back to July 16, 2021, when the Ministry of Power established a steering committee comprising representatives from the Central Electricity Authority, CERC, Power System Operation Corporation, Central Transmission Utility of India, and SECI.

In January 2022, the Power System Development Fund (PSDF) Monitoring Committee approved an annual viability gap funding of up to ₹800 million (~$9.57 million) for the project. On March 10, 2022, the Ministry issued BESS Guidelines, and SECI floated the request for selection on April 13, 2022.

Nine bids were received, and JSW Renew Energy Five was declared the winner for two 250 MW projects at a tariff of ₹1.08 million (~$12,285.19)/MW/month. Letters of award (LoAs) were issued on January 18, 2023, nearly 145 days after the auction.

Subsequently, SECI signed a battery energy storage sale agreement (BESSA) with Gujarat Urja Vikas Nigam (GUVNL) on June 26, 2023, for 150 MW, while the battery energy storage purchase agreement (BESPA) with JSW was executed on March 5, 2024, about 245 days later.

Meanwhile, the National Load Dispatch Centre filed a petition before CERC on July 31, 2023, seeking regulatory clarity on the ancillary portion. CERC approved the procedures on May 16, 2024. The BESPA between SECI and JSW for the GUVNL portion was signed on March 5, 2024, nearly one and a half years after the auction.

Shortly thereafter, SECI filed a petition before CERC on March 14, 2024, seeking the adoption of the tariff discovered in the auction. While CERC admitted the petition in May 2024, it also examined subsequent developments, including competitive bids in late 2023 and 2024 that revealed much lower tariffs, in the range of ₹448,000 (~$5,100.91)/MW/month to ₹372,000 (~$4,233.19)/MW/month.

GUVNL independently approached the Gujarat Electricity Regulatory Commission, which later approved the SECI–GUVNL BESSA in September 2024, calculating the effective price at ₹644,473.06 (~$7,329.19)/MW/month after accounting for PSDF support.

Eventually, on January 2, 2025, CERC passed the impugned order, rejecting SECI’s petition for tariff adoption, citing the inordinate delay and significant fall in market prices, which rendered the discovered tariff non-aligned with the prevailing market conditions.

CERC noted that adopting the tariff discovered in August 2022 would impose an undue burden on consumers, given subsequent cost reductions. It found delays of 145 days between the e-reverse auction and the LoAs, 160 days between LoAs and BESSA, and 245 days between BESSA and BESPA without satisfactory justification.

JSW and SECI challenged this order before APTEL by JSW and SECI, culminating in the Tribunal’s judgment on September 12, 2025.

Tribunal’s Analysis

The Tribunal acknowledged the arguments of JSW that delays were due to regulatory processes and SECI’s contention that it was wrongly blamed. However, it held that some delays were avoidable and could be attributed to internal processes.

APTEL also examined whether later tenders were comparable, noting structural differences but concluding that the overall downward trend in the market was undeniable.

It emphasized that CERC was not bound to adopt tariffs if they no longer reflected market conditions.

Recently, APTEL set aside the penalties imposed by the Delhi Electricity Regulatory Commission on BSES Yamuna Power and BSES Rajdhani Power for failing to meet their renewable purchase obligations during the financial years 2012–13, 2013–14, and 2014–15.

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