M/s Radiant Solar Energies Pvt. Ltd. vs Punjab State Electricity Regulatory Commission & Ors on 29 September 2026

O R D E R

PER HON’BLE MR. VIRENDER BHAT, JUDICIAL MEMBER

1. The appellant, a solar power generator in the State of Punjab, is aggrieved by the order dated 09.08.2017 passed by 1st respondent Punjab State Electricity Regulatory Commission (hereinafter referred to as “the Commission”) in appellant’s petition no.15/2016 whereby the claim of the appellant for extension of Scheduled Commercial Operation Date (SCOD) of its 3MW solar power project on account of force majeure events affecting the completion/commissioning of the project, has been partly allowed and at the same time the tariff of 2MW capacity of the plant has been reduced from Rs.7.58/kWh to Rs.5.09/kWh. The appellant has also been held liable to pay liquidated damages to 3rd respondent Punjab State Power Corporation Limited (in short PSPCL) and the bank guarantees given to it by 2nd

respondent Punjab Energy Development Agency (in short PEDA) have been ordered to be encashed.

2. The 2nd respondent PEDA is a designated nodal agency for development of renewable energy products in the State of Punjab and is responsible for promotion as well as development of non-conventional and renewable sources of energy in the State including solar, mini-hydro, biomass/agro-based power projects.

3. The 3rd respondent PSPCL is a distribution licensee in the State of Punjab and the successor in interest of Punjab State Electricity Board after its unbundling along with Punjab State Transmission Corporation Limited, which is the respondent no.4.

4. The brief facts, relevant for disposal of the instant appeal, are as under:-

(i) In the year 2015, 2nd respondent PEDA had invited the private developers/companies for establishment of an aggregate 250 MW capacity solar projects in the State of Punjab and had issued a Request for Proposal (RFP) document in this regard. The capacity to be developed was divided into three categories i.e. Category-I projects of 1-4 MW capacity (aggregate capacity

50MW), Category-II projects 5-24 MW (aggregate capacity 100MW) and Category-III projects 25-50 MW (aggregate capacity 100MW). The power to be generated from these projects was to be sold to third respondent PSPCL for a period of 25 years for supply to the consumers in the State of Punjab.

(ii) The selection of bidders was based on net availed tariff after providing discount on generic tariff notified by the Commission for solar PV power projects for Financial Year (FY) 2014-15 irrespective of availing normal rate of depreciation/accelerated rate of depreciation.

(iii) The Commission determined generic levelized generation tariff for renewable energy power projects for FY 2014-15 vide order dated 05.09.2014 in petition no.42/2014 (suo moto) wherein the generic tariff for solar power projects was fixed at Rs.7.72/kWh.

(iv) The appellant had submitted its bid for 3MW project under Category-I. Based on the bids received from the bidders, PEDA allocated a total capacity of 229MW solar PV power projects to various developers under different categories. The appellant was allotted 3MW solar PV power project vide Letter of Award (LoA) dated 25.02.2015. As per the provisions of RFP, the appellant was required to supply power to the 3rd respondent

PSPCL from its power project for a period of 25 years at a net tariff of Rs.7.58/kWh upon providing a discount on the generic tariff of Rs.7.72/kWh as notified by the Commission in its RE tariff order dated 05.09.2014.

(v) The appellant signed the Implementation Agreement (IA) as well as Power Purchase Agreement (PPA) for setting up of the project with PEDA and PSPCL on 19.03.2015 and 31.03.2015 respectively. As per the provisions of the PPA, the project was required to be commissioned within 10 months from the date of signing of the PPA. Thus, the SCOD of the project was 31.01.2016. The PPA was approved by the Commission vide order dated 11.05.2015.

(vi) Meanwhile, the appellant had applied for grid technical feasibility clearance on 23.04.2015 which was granted by PSPCL on 27.05.2015.

(vii) The appellant was unable to commission the project by its SCOD i.e. 31.01.2016, purportedly on account of some force majeure events. Ultimately, the 1MW capacity of the plant was commissioned on 18.05.2016 and the remaining 2MW capacity was commissioned on 15.03.2017.

(viii) Since the appellant apprehended that PSPCL may initiate action in terms of Clause 10.1.0 of PPA and Article 7.0 A of IA i.e. forfeiture of Performance Bank Guarantee, it approached the Commission by way of petition no.15/2016 claiming following reliefs: - “a) direct PSPCL and PSTCL to make the bay ready for synchronization; b) restrain respondents from forfeiture of performance bank guarantees in terms of clause 10.1.0 of PPA and article 7.0 A of IA till bay is ready for synchronization; c) extend the date of commissioning of the project till bay is ready for synchronization.”

(ix) Prayers (a) and (b) had been made in the petition as, according to the appellant, PSPCL was unable to complete the construction of 66kV bay at Pathrala sub-station even after nine months of granting grid feasibility clearance to the appellant and had also failed to install potential transformers as well as other electrical equipment.

(x) The petition has been disposed of by the Commission vide impugned order dated 09.08.2017 thereby condoning the delay

of 49 days (41 days from the date of signing of PPA on 31.03.2015 up to date of its approval by the Commission i.e. 11.05.2015 plus 8 days from 10.05.2016 when the appellant applied for synchronization of the project to the grid till 18.05.2016 when the 1MW capacity of the project was commissioned). The Commission has refused to condone the remaining part of delay in commissioning of the 1MW capacity as well as 2 MW capacity of the project as sought by the appellant. While keeping the tariff of 1MW capacity undisturbed, the Commission worked out the tariff of 2MW capacity at Rs.5.09/kWh.

(xi) Accordingly, the appellant is before us in this appeal.

5. We have heard Shri Tajender K. Joshi, learned counsel for the appellant Shri Sakesh Kumar, learned counsel for the 1st respondent Commission, Shri Adil Singh Boparai, learned counsel for the 2nd respondent PEDA and Mr. Anand Ganesan, learned counsel for the 3rd respondent PSPCL. We have also perused the written submissions filed on behalf of appellant, 2nd respondent and the 3rd respondent. The Commission has not filed written submissions.

Our Analysis: -

6. In the Memo of Appeal, it has been the contention of the appellant that:

(i) The entire delay in commissioning of the project ought to have been condoned and SCOD of the entire project ought to have been extended in view of the force majeure events agitated by the appellant; and

(ii) the tariff of said 2Mw capacity of the project ought not to have been reduced to a tariff arrived in the subsequent year for a 50MW capacity project.

7. During the hearing of the appeal, the learned counsel for the appellant did not advance any submissions on point no.(i) hereinabove and confined his submissions only to point no.(ii) hereinabove. His submission was that this Tribunal may consider the point no.(i) and decide the same as per its wisdom.

8. We may note that with regards to 1MW capacity of the power project, the Commission has returned the following findings in the impugned order:- “The Commission notes that as per the PPA, the SCOD of the project was 30.01.2016. The 1 MW capacity of the project was commissioned on 18.05.2016 after a delay of 109 days.

However, though the said capacity of the project at site was ready for synchronization on 09.04.2016, the work of 66 kV line was completed by the petitioner on 03.05.2016. The petitioner applied for synchronization clearance on 10.05.2016 and the same was granted by PSPCL on the same date. However, the 1 MW capacity of the project was commissioned on 18.05.2016 as the work of the 66 kV bay at Pathrala sub- station was completed by PSPCL on 17.05.2016. As such, the delay in commissioning of the 1 MW capacity of the project from 30.01.2016 to 10.05.2016 (101 days) is attributable to the petitioner and from 10.05.2016 to 18.05.2016 (8 days) is attributable to PSPCL. The Commission has already allowed above the period of 41 days in favour of the petitioner. Thus, a total period of 49(41+8) days is allowable to the benefit of the petitioner. Therefore, the commissioning of 1 MW capacity of the project is considered to be delayed by the petitioner by 60 (109-49) days and the same is deemed to have been commissioned on 30.03.2016 which is within the validity of the applicable tariff i.e. 31.03.2016. Thus, the petitioner is liable for forfeiture of the PBGs for the said delay in terms of article 7.0 A (i) of the IA and clause 10.1.0 of the PPA. It is clarified that there is neither any case for levy of liquidated damages by PSPCL nor any adverse impact on the tariff mentioned in the PPA with regard to the 1 MW capacity of the project commissioned on 18.05.2016.” (Emphasis supplied)

9. Having regard to the material on record which has been duly considered by the Commission while passing the impugned order, we do not find any ground to interfere in these findings of the Commission.

10. With regards to the balance 2MW capacity of the project, the Commission has returned following findings in the impugned order: - “The said 2 MW capacity was commissioned on 15.03.2017. The petitioner justified the delay stating that SIDBI curtailed funds due to non completion of 66 KV bay work at Pathrala sub-station. The petitioner wrote a letter dated 11.07.2016 to SIDBI to disburse the remaining loan amount. SIDBI vide letter dated 26.08.2016 informed that it is ready to disburse the remaining loan amount subject to certain conditions. The petitioner procured the solar PV modules for the remaining 2 MW capacity on 01.02.2017 and commissioned the same on 15.03.2017. The Commission is not convinced of the submissions made by the petitioner with regard to delay in completion of the remaining 2 MW capacity due to delayed disbursement of loan by SIDBI. The petitioner appears to have not followed up diligently with SIDBI for releasing the remaining funds. After commissioning of 1 MW capacity on 18.05.2016, the petitioner approached SIDBI on11.07.2016 for the purpose who reverted back on 26.08.2016 and confirmed that it is ready to disburse the remaining loan and accepted the revised date of commissioning as 31.03.2017. However, the petitioner did not take any concrete action to complete the remaining work.

Even otherwise, the petitioner had earlier categorically made the submissions that the project will be funded through internal resources/unsecured loans from the parent company. As such, it is felt that the petitioner had the financial capability to commission the remaining 2 MW capacity much earlier. PSPCL's submissions that it was the lackadaisical attitude of the petitioner which delayed the project appear more convincing and the Commission tends to agree.

The remaining 2 MW capacity was commissioned on 15.03.2017 i.e. 410 days after the due date of commissioning on 30.01.2016. Considering the benefit of 49 (41+8) days allowed by the Commission in favour of the petitioner in the paras above while working out the delay in commissioning of 1 MW capacity, the net delay attributable to the petitioner in commissioning of the remaining 2 MW capacity works out to 361 (410-49) days.

Thus, the petitioner is liable for forfeiture of the PBGs by PEDA, in terms of the provisions in article 7.0 of the IA and clause 10.1.0 of the PPA in respect of 2 MW capacity of the project as well.

As regards the levy of liquidated damages (LD charges) by PSPCL and payment whereof by the petitioner, it is seen that the petitioner proceeded with the commissioning of the remaining 2 MW capacity despite the adverse implications with regard to levy of liquidated damages upto the date of

commissioning as also adverse impact on the tariff having been clearly brought out in the Commission's interim Order dated 24.12.2016 while allowing the petitioner to install the remaining 2 MW capacity. The Commission had allowed the same citing circumstances mentioned therein in the interest of all the stakeholders, even though the same was liable for cancellation in terms of the contractual documents. As the remaining 2 MW capacity has been commissioned with a delay of 361 days, PSPCL is entitled to levy and claim liquidated damages for the said period at the rate provided in clause 10.1.1 of the PPA.” (Emphasis supplied)

11. We are also unable to find any error in these findings of the Commission. We have not found any material on record which may convince us to take a contrary view and thus, affirm these findings of the Commission.

12. In so far as the tariff for 2Mw capacity of the project, the Commission has determined the same at Rs.5.09/kWh in place of Rs.7.8/kWh for which the bid of the appellant had been accepted, on the following reasoning: - “The tariff was valid till 31.03.2016 in terms of the Order of the Commission dated 11.05.2015 in petition no. 21 of 2015 and the IA/PPA. As the remaining 2 MW capacity of the project has been commissioned with a delay of 361 days beyond the

SCOD on 30.01.2016, the tariff of ₹ 7.58 per kWh for the said capacity would no longer hold good. The Commission has determined the tariff for the remaining 2 MW capacity of the project in the following para.

The tariff of ₹ 7.58 per kWh for the petitioner's project was determined through competitive bidding process undertaken by PEDA on the basis of discount to be offered by the bidders on the generic tariff of ₹ 7.72 per kWh determined by the Commission for FY 2014-15 and the tariff was valid till 31.03.2016. For FY 2015-16 also, PEDA conducted the competitive bidding process on the same basis of discount to be offered by the bidders on the generic tariff of ₹ 7.04 per kWh for FY 2015-16 determined by the Commission wherein the lowest tariff discovered was ₹ 5.09 per kWh and approved by the Commission in its Order dated 10.06.2016 in petition no.31 of 2016 and the same was valid upto 31.03.2017. Under the circumstances, the Commission considers the petitioner's project akin to such projects. The Commission notes that in interim order dated 24.12.2016, it allowed the prayer of the petitioner in the application dated 08.12.2016 to the extent that it may add the solar PV modules for the remaining 2 MW capacity and commission the same by 31.03.2017 without prejudice to the rights of the respondents accruing due to the aforesaid extension being granted with regard to, encashment of Performance Bank Guarantee by PEDA, levy of liquidated damages by PSPCL upto 31.03.2017 and reduction in tariff of the petitioner's project, which could be the minimum tariff

discovered in the subsequent bidding process and adopted by the Commission in its Order dated 10.06.2016 in petition no. 31 of 2016 i.e.₹5.09 per kWh, which shall be decided by the Commission on merits in the final Order in the petition.

Accordingly, the Commission finds it just and fair to fix the tariff for the 2 MW capacity out of 3 MW total capacity of the project as ₹5.09 per kWh. As such, the tariff for the project payable by PSPCL w.e.f. 15.03.2017 would be worked out on the basis of the weighted average tariff considering the tariff of ₹7.58 per kWh for 1 MW capacity and ₹5.09 per kWh for the remaining 2 MW capacity. It is clarified that the tariff for the period 18.05.2016 to 14.03.2017 for the 1 MW capacity would be ₹ 7.58 per kWh.” (Emphasis supplied)

13. It not in any dispute that as per Article 3 (C) of the Implementation Agreement dated 19.03.2015 executed between the appellant and respondent no.3, in case the COD of the project goes beyond 31.03.2016, the tariff stated in Article 3(A) therein shall cease to exist and the project developer would be required to get the tariff redetermined from the Commission.

14. In the instant case, the appellant has commissioned the 2MW capacity of its project on 15.03.2017 with a delay of 410 days out of which 49 days delay has been condoned by the Commission. Notwithstanding the same,

the COD of the said 2MW capacity of the project has crossed the deadline of 31.03.2016 and therefore, the appellant is not entitled to the PPA tariff of Rs.7.58/kWh. The tariff for the said capacity of the project was to be redetermined by the Commission. The Commission has taken note of the fact that the lowest tariff discovered in the competitive bidding process for the FY 2015-16 was Rs.5.09/kWh which was approved vide order dated 10.06.2016 in petition no.31/2016 and was valid up to 31.03.2017. Since the 2MW capacity of the appellant’s project was commissioned on 15.03.2017, the Commission has applied the said lowest discovered tariff of Rs.5.09/kWh to the same.

15. Learned counsel for the appellant argued that the competitive bidding conducted in the year 2015-16, in which the lowest tariff of Rs.5.09/kWh was discovered, was for inviting bids for a minimum capacity of 50MW. He would submit that the Commission erred in applying the tariff offered for a 50MW capacity project to the appellant’s project of 3MW capacity for the reason that the financing capacity, bargaining capacity and transmission lines related to a 50MW capacity project are totally distinct from those related to a 3MW capacity project.

16. In this regard, we find it apposite to refer to the case of another solar developer M/s Abundant Energy Pvt. Ltd which was allotted 1MW capacity

project in the same bidding process in which the appellant has been allotted the 3MW capacity project. In the case of M/s Abundant also, the Commission did not extend the SCOD of the project while rejecting the force majeure claims of the developer. Accordingly, the Commission disposed of the petition no.25/2016 filed by the developer M/s Abundant Energy Pvt. Ltd. vide order dated 14.02.2017. At the same time, the Commission reworked the tariff for the power project of the developer M/s Abundant Energy Pvt. Ltd. to Rs.5.39/kWh to be payable by PSPCL. Subsequently, the review petition filed by the developer M/s Abundant Energy Pvt. Ltd was allowed by the Commission vide order dated 21.05.2018 thereby overturning its previous order dated 14.02.2017 and allowing the force majeure claims of the developer. Thus, the SCOD of the project was extended and the PPA tariff of Rs.7.68/kWh was granted. Against the said order dated 21.05.2018 of the Commission, PSPCL approached this Tribunal by way of appeal no.316/2018 which was allowed by this Tribunal vide judgment dated 28.08.2024 thereby setting aside the review order dated 21.05.2018 and restoring the previous order dated 14.02.2017 of the Commission. Thus, this Tribunal affirmed the redetermined tariff of Rs.5.39/kWh in respect of the developer M/s Abundant Energy Pvt. Ltd. in that case.

17. The appellant has referred to the said case in its written submissions but has added that such reference may not be construed as acceptance of the method of redetermination of tariff adopted by the Commission in the order passed in that case. The 3rd respondent PSPCL has also referred to the said case in its written submissions but has attempted to distinguish the same on the ground that the appellant had procured the modules on 01.10.2017 at reduced prices, and therefore, cannot claim tariff comparable to the project of M/s Abundant Energy Pvt. Ltd which had achieved COD much earlier i.e. on 24.08.2016. Another distinction between the two cases, which is highlighted on behalf of PSPCL, is that the tariff for which bid was submitted by the appellant in this case was 10paisa less than what was bid by M/s Abundant Energy Pvt. Ltd. and therefore tariff redetermined for M/s Abundant Energy Pvt. Ltd. cannot be applied to the appellant herein.

18. We concur with the submissions on behalf of the appellant that the Commission ought not to have applied the lowest discovered tariff of Rs.5.09/kWh during the competitive bidding process for FY 2015-16 for the reason that minimum capacity for which bids were invited was 50MW. By no stretch of imagination can the tariff discovered for a 50MW project be applied to a 3MW capacity project. In so far as the tariff of Rs.5.39/kWh determined for the project of M/s Abundant Energy Pvt. Ltd. (as approved by this Tribunal also in appeal no.316/2018) is concerned, we note that M/s Abundant Energy

Pvt. Ltd had commissioned the project on 24.08.2016 indicating that the entire equipment had been purchased and procured by the developer much prior to the said date. However, in the instant case, the appellant has commissioned the project on 15.03.2017. Admittedly, the appellant procured the modules for the solar plant on 01.02.2017. It is the case of the PSPCL that at that time, the prices of solar modules had reduced substantially. Despite contending so, PSPCL did not produce any material to show that the prices of solar modules prevailing prior to 24.08.2016 had reduced substantially by January, 2017 and if so, by what percentage. Therefore, we are unable to hold with certainty that there had been any such substantial or marginal reduction in the prices of solar modules between August, 2016 and January, 2017.

19. The fact, however, remains that M/s Abundant Energy Pvt. Ltd. had submitted its bid at the tariff of Rs.7.68/kWh whereas, the appellant had bid for the tariff of Rs.7.58/kWh i.e. 10 paisa less than the bid tariff submitted by M/s Abundant Energy Pvt. Ltd. Therefore, it would be just and fair to reduce 10 paisa from the tariff redetermined by the Commission for the project of M/s Abundant Energy Pvt. Ltd, as affirmed by this Tribunal in appeal no.316/2018. By doing so, the tariff to be approved for the project of the appellant would be Rs.5.29/kWh.

Conclusion: -

20. Thus, we uphold the impugned order of the Commission in so far as it has refused to condone the delay in commissioning of the solar power project of the appellant beyond 49 days, has held PEDA entitled to encash the Performance Bank Guarantee of the appellant and has held the appellant liable to pay liquidated damages to 3rd respondent PSPCL for the delay of 361 days in commissioning of 2MW capacity of the project. However, the tariff of Rs.5.09/kWh determined by the Commission for the appellant’s power project in the impugned order cannot be sustained. We hold that the appellant shall be entitled to the tariff @Rs.5.29/kWh for the power supplied from its power project to the 3rd respondent PSPCL.

21. The 3rd respondent PSPCL shall pay entire differential in tariff, if any, to the appellant within four weeks from the date of this judgment positively.

22. The appeal stands partly allowed, albeit in above terms. All pending IAs, if any, also stand disposed of.

Pronounced in the open court on this the 29th day of September, 2026.

(Ajay Talegaonkar) Technical Member (Electricity)

(Virender Bhat) Judicial Member

REPORTABLE / NON-REPORTABLE

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