Karnataka Commission Denies Commissioning Extension to Four Solar Projects

The Commission also lowered the tariffs for these projects for the delays in project commissioning


The Karnataka Electricity Regulatory Commission (KERC) has passed orders for four solar power developers asking them to pay liquidated damages for delays in project commissioning.

In its orders, the KERC also revised the tariff for the supply of power downward, stating that the extension of time by power distribution companies (DISCOMs) cannot be granted without altering the terms of the original power purchase agreements (PPA). It added that this would have an impact on the tariff payable by the DISCOMs.

All four developers – Red Earth Green Energy Private Limited, Clearsky Solar Private Limited, Mytrah Akshaya Energy Private Limited, and Mytrah Advaith Power Private Limited – had filed individual petitions with the Commission. All of them sought the extension of scheduled commercial operation dates (SCOD) for their solar projects.

Red Earth Green Energy requested the KERC to approve the six-month extension granted by the Hubli Electricity Supply Company Limited (HESCOM) on account of changes in the evacuation point of the project. It said that this delay, along with other procedural delays, resulted in the project not being commissioned on time.

In its order, the Commission denied the extension of time, stating that the developer failed to establish sufficient grounds to ask for the extension. Additionally, it revised the tariff payable by the DISCOM to ₹6.52 (~$0.087)/kWh for power purchased from its projects. It also said that the developer was liable to pay liquidated damages to compensate for the delay in the commencement of the supply of power.

The second petition was filed by Clearsky Solar, who also sought approval for the SCOD extension given by the Gulbarga Electricity Supply Company Limited (GESCL), another DISCOM. It also asked the Commission to direct the DISCOM to pay a tariff of ₹8.40 (~$0.11) /kWh and to approve a supplemental PPA without altering the tariff.

The Commission denied this request for SCOD approval as well and prescribed a tariff of ₹4.36 (~$0.058)/kWh payable by the GESCL for the purchase of power. It also ordered Clearsky Solar to pay a penalty of ₹360,000 (~$4,803) for the non-fulfillment of conditions as per the PPA.

The KERC also passed an order for petitions raised by Mytrah Akshaya Energy Private Limited, and Mytrah Advaith Power Private Limited, both of them are special purpose vehicles (SPV) owned by renewable developer Mytrah Energy.

Mytrah Akshaya Energy was the selected bidder for the development of a 15 MW solar power project at the Raibag taluk in Belagavi district, while Mytrah Advaith Power was selected for a 15 MW solar project at Sindagi taluk in Vijayapura district. They had signed PPAs with the GESCL and the Bangalore Electricity Supply Company (BESCOM), respectively, for the sale of solar power from these projects.

In their petitions, both companies had requested for at least a 120-day extension to their SCODs to help them fulfill their obligations under their respective PPAs. It also asked the Commission to direct the respondents to enter into a supplementary PPA, incorporating the extended SCOD in it.

In its orders, the Commission said that both Mytrah Akshaya Energy and Mytrah Advaith Power were not entitled to any of the reliefs they claimed. The KERC also set a reduced tariff of ₹4.36 (~$0.058)/kWh for the power supplied to the respondents from the commercial operation date during the term of the PPA for both the projects.

It also stated that both companies were liable to pay liquidated damage for the delay in commencement of power supply to the DISCOMs as per their respective PPAs.

In March, the Appellate Tribunal for Electricity allowed an appeal by Azure Sunrise Private Limited and set aside an order passed by the KERC, reducing the approved timeline extension for the commercial operation date of a 50 MW solar project in the state.

Previously, the KERC ruled against another petition filed by the SPVs of SunEdison Energy – SEI Aditi Power, SEI Bheem, SEI Suryashakthi, SEI Diamond, and SEI Venus. The solar power developer had filed petitions with the KERC requesting the extension of the scheduled commercial operation date for solar projects totaling 150 MW on the grounds of force majeure events.