energy sector litigation - The Legal Chamber

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...

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...

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Supreme Court Clarifies When Electricity Contracts Beat Regulatory Caps

Supreme Court Clarifies Jurisdiction of Electricity Regulators in Franchisee Disputes