electricity law - The Legal Chamber

Supreme Court Clarifies When Electricity Contracts Beat Regulatory Caps

12Aug

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Clarifies When Electricity Contracts Beat Regulatory Caps

The Supreme Court ruled that Note 3 of Regulation 55 of the CERC Regulations, 2019, which caps free power supply to states at 13%, is only for tariff calculation and does not override contractual obligations under the Implementation Agreement. The Court held that writ jurisdiction was inappropriate, as disputes involving regulatory interpretation must first be addressed by the specialized CERC. The judgment reaffirms that contractual rights remain enforceable unless expressly prohibited by law. Facts Of The Case: The case involves a dispute between the State of Himachal Pradesh and JSW Hydro Energy Limited over the supply of free power from a hydroelectric project. In 1993, the state allotted the Karcham Wangtoo Hydroelectric Project to a predecessor company of JSW Hydro under a Memorand...

Supreme Court Clarifies Jurisdiction of Electricity Regulators in Franchisee Disputes

7Aug

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Clarifies Jurisdiction of Electricity Regulators in Franchisee Disputes

The Supreme Court ruled that Electricity Regulatory Commissions (ERCs) lack jurisdiction to entertain petitions solely based on public interest under the Electricity Act, 2003. It held that franchisees, as agents of distribution licensees, are not directly regulated by ERCs, and investigations under Section 128 must target licensees, not franchisees. The Court emphasized that ERCs cannot micromanage franchisee agreements, as their regulatory oversight is limited to licensees. The judgment clarified that contractual disputes between licensees and franchisees fall outside ERCs' adjudicatory scope under Section 86(1)(f). The appeal was allowed, setting aside APTEL's order. Facts Of The Case: The case involved a dispute between Torrent Power Limited (appellant) and the Uttar Pradesh Elec...

“Who Pays for Delays in Power Projects? : Supreme Court Explains CERC’s Role in Tariff and Compensation”

22May

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Supreme Court

“Who Pays for Delays in Power Projects? : Supreme Court Explains CERC’s Role in Tariff and Compensation”

The Supreme Court held that the Central Electricity Regulatory Commission (CERC) can exercise regulatory powers under Section 79 of the Electricity Act, 2003 to impose compensation for delays, even without specific regulations under Section 178. It clarified that CERC’s orders under Section 79 are appealable to APTEL under Section 111, not through writ petitions unless jurisdictional or constitutional issues arise. The Court emphasized that regulatory gaps can be addressed via Section 79, distinguishing it from legislative rule-making under Section 178. The High Court erred in entertaining the writ petition when an alternative remedy existed. Facts Of The Case: The case involved a dispute between Power Grid Corporation of India Ltd. (PGCIL) and Madhya Pradesh Power Transmission Company L...

Supreme Court Decides “what It Means for Future Agreements” : Lead Partner Liable for Full Payment in Power Project Dispute

19May

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Decides “what It Means for Future Agreements” : Lead Partner Liable for Full Payment in Power Project Dispute

The Supreme Court upheld the doctrine of privity of contract, ruling that Brua Hydrowatt Pvt. Ltd. (BHP) was solely liable for transmission bay costs under its agreement with HP Power Transmission Corporation (HPPTC), despite internal arrangements with third parties. The Court held that non-signatories (Respondent Nos. 2 & 3) could not be bound by the contract, reversing APTEL’s order. The judgment reaffirmed that contractual obligations apply only to parties to the agreement, unless explicitly extended. Facts Of The Case: The dispute arose between HP Power Transmission Corporation Ltd. (HPPTC) and M/s Brua Hydrowatt Pvt. Ltd. (BHP) over the liability for construction and maintenance costs of a 66kV power transmission bay at Urni, Himachal Pradesh. BHP, along with two other power com...