The Hindu : Tamil Nadu / Chennai News : Conditions for power plants held ultra vires

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Friday, Oct 31, 2008
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Tamil Nadu

Tamil Nadu - Chennai

Conditions for power plants held ultra vires

T. Ramakrishnan

CHENNAI: The Tamil Nadu Electricity Regulatory Commission (TNERC) has held ultra vires of the Electricity Act certain conditions laid down by the State government for promoters of merchant power plants.

Three promoters of the proposed plants who were issued letters of facilitation last year approached the panel.

They questioned the stipulations with regard to the timeframe for commissioning the projects, the tariff of power to be supplied by the plants, the levy of area development contribution of Rs. 1 lakh a year per megawatt of installed capacity and making available the capacity in excess of 85 per cent of the load to the Tamil Nadu Electricity Board at a variable cost.

In similar orders issued last week, the Commission held the conditions ultra vires of the Act. The orders would take prospective effect.

The Commission said there would be no refund of the area development contribution, if the petitioners made the payment without protest.

The petitioners were Ind-Barath Power (Madras) Limited, Hyderabad; PEL Power Limited, Mumbai; and Tridem Port and Power Company Private Limited, Chennai. In respect of the first two, the government issued letters of facilitation in December 2007, while in the case of the third, the letter was issued in September last. Subsequently the government issued orders, stipulating the conditions.

The Commission said the allotment of coal blocks/coal linkage had no bearing on the issues involved.

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