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Home News Power Sector News Power users to gain as SC rejects stay on HC order

Power users to gain as SC rejects stay on HC order

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Supreme CourtThe Supreme Court has refused to grant a stay on a Calcutta High Court order that bars the electricity regulator from fixing provisional tariffs for new power units. A senior official of the Central Electricity Regulatory Commission (CERC) said the Supreme Court on Friday refused a stay on the high court order, benefiting consumers who had appealed against the commission's provisional tariff orders for power plants of the Damodar Valley Corp (DVC). While the Supreme Court decision will force DVC to revert to its old rates immediately, it also portends trouble for power generators NTPC and NHPC whose significant capacities are regulated by the CERC.

Last year, a group of consumers had challenged the CERC's provisional tariff orders for DVC's plants in the Jharkhand High Court, which had ruled in favour of the consumers, prompting the CERC to move to a divisional bench in the same court. The divisional bench ruled in favour of the CERC, after which the consumers, led by Jai Balaji Industries and Bhaskar Sarachi Alloys, moved the Supreme Court and simultaneously appealed in the Calcutta High Court. The Calcutta High Court last week said the CERC does not have the power to fix provisional tariffs.

The Supreme Court will hear in January the plea challenging the Jharkhand High Court order.

According to the official, about 50,000 mw of electricity generating capacity and 96,000-circuit km of transmission capacity of the Power Grid Corp, which is regulated by the CERC, will be affected if the Supreme Court decides in favour of the consumers.

The apex court has, however, granted a stay for DVC's consumers in West Bengal. "It is a negative fallout for DVC," the CERC official said.

DVC chairman RN Sen said as per the high court order, the CERC will have to issue a final tariff for all units of the company within two months.

"While we will get the final tariff within two months and will be able to start raising bills, we have dues of about Rs 500 crore from various consumers, which will have to wait till the final tariff is notified," Sen said.

Counsels for CERC and DVC, Gopal Subramanium and Haren P Raval, on Wednesday filed a special leave petition seeking an urgent stay on the high court order.

Source- Economic Times


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