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Solar developers, DISCOM Spar Over CUF considered for security duty reimbursement

  Both solar generators have filed an appeal with APTEL against the Commission's earlier order

Maharashtra (Natural Energy News): The Maharashtra Electricity Regulatory Commission (MERC) has said that if generators modify the capacity utilization factor (CUF) as per the provisions of the Power Purchase Agreement (PPA), then consider the revised CUF for calculation of the revised DC module capacity for calculation Will be done. Security compensation under the 'change in law' clause.

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Juniper Green Energy and Nisagara Renewable Energy filed petitions seeking clarification regarding the Commission's comments concerning the amendment of the CUF without increasing DC's installed capacity.

The background:

Due to the imposition of safeguard duty on the import of solar cells and modules, the Commission issued a general order on July 23, 2020, which considered a 'change in law' regarding the approval and defining of quantity and compensation mechanisms.

The commission said in its order:

"To meet the contractual obligation to supply a total of 100 MW (AC) capacity from 10 projects to MSEDCL, the petitioners are entitled to compensation under a change in law for a maximum DC capacity of 133 MW."

The generator stated that the commission in its order accepted and acknowledged that the solar generator has the option to modify the CUF within one year from the commissioning date of the project. However, if prohibiting further claims of 'change in law' for any additional modules in case of modifying the DC installed capacity, the Commission did not clarify that the generator would maintain its CUF while maintaining the installed DC capacity. Modifies what should happen.

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Both generators stated that the PPA made provision for amendment of the CUF. On the one hand there was confusion over the observation of the Commission to allow revision of the CUF and to deny any other claim of 'change in law' towards any additional modules in case of upward revision of DC installed capacity and clarification. Was required.

Apart from this, the requested clarification would also benefit Maharashtra State Electricity Distribution Company Limited (MSEDCL) in a situation where a generator declares 'downgraded'.

MSEDCL stated in its submission that the generators were trying to get relief for their installed DC capacity of 145.51 MW using the clause in the PPA, which provided for resetting the CUF during the first year after the commission date. I went.

State DISCOM stated that the Commission's prior order was absolutely clear and without any ambiguity that even if the generator resets the CUF as per the PPA provision, any further claim for any additional module in the case of modifying the DC capacity is admissible. Will not done.

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In addition, it added that any changes to the CUF after the implementation of the PPA, and during the first year after the commission date, make a commercial decision of the solar generator based on its performance in the first year.

Commission analysis:

In its earlier order, the Commission mentioned that the petitioners had approached the Commission to 'change the law towards imposition of safeguard duty'. The Commission adopted the formula (AC contracted capacity x (declared CUF / Minimum Guaranteed CUF as per bid)) to determine solar DC capacity, which was eligible for compensation.

This intervention required that compliance with PPA provisions only be passed on to consumers to ensure and allow prudent inspection of DC capabilities under the 'change in ities law' and to avoid the burden of generator inefficiencies.

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The state regulator stated that the petitioners suggested that the revised CUF formula should be considered for calculation of qualified DC capacity which would be considered for calculation of compensation under the change in law. '

MSEDCL has opposed such a request that any change or modification in the CUF, after the execution of the PPA and within the first year of the commission date, was a commercial decision of the solar generator.

The regulatory body said that the PPA allowed the generator to modify the CUF within the first year of the project's commissioning. The revised CUF will be declared as CUF for other modalities envisaged under PPA.

Therefore, the revised CUF within one year from the date of commissioning of the project needs to be considered for allowable DC capacity for capacity changes in compensation of law.

The Commission has explicitly mentioned that the above ruling only considers the issue of declared CUF when calculating the allowable DC capacity to compensate for the law.

Challenging the above decision of the Commission to restrict the allowable DC capacity to compensate for defense charges under the 'change in law' as per the formula specified in the Commission's earlier order, both the petitioners filed before the Appellate Tribunal for Electricity (APTEL) Appeal is filed.

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