APTEL upholds MERC order on compensation for Tiroda thermal power plant

The Appellate Tribunal of Electricity (APTEL) has upheld an order of electricity regulator Maharashtra Electricity Regulatory Commission (MERC) for compensation for non-availability of coal for its arm Adani Power Maharashtra Limited (APML).

In September 2019, MERC had allowed compensation on account of non-availability of coal from Lohara coal block to APML in respect of its 1,320 MW power purchase agreement (PPA) with the Maharashtra State Electricity Distribution Company Limited (MSEDCL). The PPA, dated September 8, 2008, was for the company’s power plant at Tiroda in district Gondia, Maharashtra.  The Tiroda Thermal Power Station has an installed capacity of 3,300 MW, of which Units 2 and 3 have been tied up under the PPA dated September 8, 2008 and Units 1, 4, 8 and 5 have been tied up under separate PPAs executed with MSEDCL for 1,765 MW. As per MERC’s order, de-allocation of the Lohara coal block by the Ministry of Coal would qualify as change in law, and APML was entitled to compensation for alternative coal used to meet the shortfall.

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