Trilegal represented ACME, a solar power developer, in proceedings challenging the levy and recovery of transmission charges by the Central Transmission Utility of India (CTU).
As per the prevailing regulatory regime, renewable power producers are exempt from payment of transmission charges for the entire term of the Project. However, the Appellate Tribunal for Electricity held that ACME was not entitled to this exemption for the period of mismatch when the transmission asset was ready but there was a delay in commissioning of the generation asset by ACME.
It was argued that the delay in commissioning the generation asset by ACME was on account of force majeure events, being the Order dated 19.04.2021 passed by the Supreme Court in the Great Indian Bustard matter wherein all transmission lines in identified areas of Rajasthan were mandatorily to be undergrounded. Reliance was placed on statutory Orders passed by the Ministry of Power under the Electricity (Transmission Planning) Rules, 2021, which provided that no transmission charges can be imposed if the Scheduled Commissioning Date of the generation project has been extended by the competent authority.
Agreeing with Trilegal’s submissions, the Supreme Court restored the earlier interim protection that had been vacated by the Appellate Tribunal. Thereby implying that ACME, being a solar power developer, is exempt from payment of transmission charges.
This Order (attached) underscores the significance of the promotion of renewable energy in India and reaffirms the principle that the levy of transmission charges ought to be aligned with the commissioning of Projects.
The Order impacts all renewable energy players in the country, specifically 38 GW of projects which are planned to be commissioned in 2025 and are facing similar challenges for payment of transmission charges on account of a mismatch between the commissioning of the generation assets and transmission assets.
The Trilegal team was led by Disputes Partner Vishrov Mukerjee, comprising attorneys Girik Bhalla, Senior Associate, and Priyanka Vyas, Associate.
About Trilegal
Trilegal is one of India’s leading law firms, with expertise across the full spectrum of corporate legal services. Trilegal has offices in four key cities of India.
Trilegal has been recognised as the India Deal Firm of the Year by Asian Legal Business (ALB) India Law Awards 2023; one of the ‘Best Overall Law Firms’ at the India Business Law Journal Indian Law Firm Awards 2022; ‘Firm of the year’ for Client Service Excellence by Asia Law Awards 2021; “M&A Law firm of the Year” by VCCircle Awards 2020 one of the most innovative law firms in Asia in the inaugural edition of ALB Trailblazers 2020; and ‘highly commended’ in the FT RSG Innovative Lawyers Awards 2020.
Share your news, articles, deals, columns, or press releases with us! Click the link to submit and join our platform today.
