At its meeting on 25 July 2015, the BESCOM Board of Directors approved and approved the purchase of solar energy from the above-mentioned project. Subsequently, the project promoter asked BESCOM to facilitate the signing of a PPA signed on 7 July 2015. Subsequently, the Commission approved the PPAs on 28 August 2015. Energy experts have called for an urgent review of the policy to reduce the burden on the state and consumers. Meanwhile, congress and the Aam Aadmi party`s state unit called for a judicial inquiry into the matter, alleging that the state had purchased electricity from central agencies despite the expiration of contracts. Recently, kerC rejected a request by BESCOM to reinstate the additional electricity feed-in tariff or to exempt it from the obligation to purchase additional energy beyond the capacity contractually agreed in the PPA. The state buys electricity from power plants at Rs 5.31 per unit, which is about 50 percent more than the purchase cost of the Karnataka Thermal Power Plant at about Rs 4.8 per unit. According to the PPA, the Planned Completion Date (OCS) and Commercial Operating Date (DOC) were to be reached within 18 months of the date of signature. However, it was not clear whether the effective date mentioned in the definition clause of the PPA coincided with the effective date. Mention is made of the lump sum compensation (LD) for delaying the start-up of the power supply.

The authority to extend the commissioning time has been delegated to BESCOM. At its meeting on 25 July 2015, BESCOM approved the purchase of solar energy for the project. The parties signed the PPAs on 7 July 2015 and the PPAs were approved by the Commission on 26 August 2015. Tags: Contractual provisions, Climate Smart, Renewable energy, Energy and electricity, Wind energy, Energy and core energy An RTI application revealed that despite the expiry of the 12-year purchase agreement, the state procures additional electricity from central entities at a higher cost, even though the state has not responded to power purchase agreements with power plants, this could lead to unnecessary spending of Rs 44,000 crore over the next four years, V Ponnuraj, managing director of Karnataka Power Corporation Ltd, warned the government. However, the state denied the allegations, saying that terminating/revising power purchase agreements would result in penalties and would have serious repercussions if the state did not anticipate the future requirement. The state is forced to rely on external sources because electricity produced from renewable sources is still not stable and reliable. The Commission found that the developer had requested an evacuation of the electricity on 27 September 2016 and that KPTCL had granted an evacuation permit on 6 December 2016 after a period of more than two months. Moreover, BESCOM and KPTCL have not disputed those facts. In a letter to the Additional Chief Secretary of the Ministry of Energy (as received in the RTI Act), Ponnuraj said Karnataka has an unused electricity surplus of 55,387 million units (as of August 2019). The government could have avoided paying the central authorities a sum of Rs 1,10,69 crore for the current year and about Rs 5,000 crore last year if it had terminated or reviewed the power purchase agreement with the central agencies.

The Commission stated that it was not disputed that the PPA had been implemented on 7 July 2015 and that the date of entry into force meant the date of signature of the agreement by the parties, namely 7 July 2015. A right to information (RTI) request revealed that, despite the expiry of the 12-year purchase agreement, the State procured additional electricity (electricity units) from central authorities such as NTPC, NLC, NPCIL at a higher cost. It continues to buy electricity from companies even though the contract has expired. If the state continues with the production of 10,000 megawatts of solar power under the PM-Kisan Urja Suraksha evem Utthan Mahabhiyan (KUSUM) programme, the non-use capacity will increase to 81,667 million units, resulting in a loss of Rs 17,900 crore per year, the letter said. According to the PPA, the expected completion date is expected to be reached within 18 months of the signing of the PPA. Bescom has been given the power to extend the commissioning period. Energy expert MG Prabhakar, who was part of kerc`s advisory committee, said the state`s decisions on tariff increases and the power purchase agreement did not bode well for private and industrial consumers in the long run. The state should offer the excess electricity produced to industry at least at night (about 15-20%) at a cheaper price, rather than raising tariffs. In this way, the state could boost production, make production competitive, which would lead to a higher GST investigation and create jobs,” Prabhakar said. The Karnataka government has cost the Treasury 15,000 crore over the past 18 months by failing to terminate the power purchase agreement with the central authorities, even though it had excess electricity. A Power Purchase Agreement (PPA) has been signed between Bangalore Electricity Supply Company Limited (BESCOM) and the developer of the Cambria Solar project.

In addition, the Commission approved the six-month extension granted by BESCOM for the commissioning date of the solar project. This comes against the backdrop that the state-run Karnataka Electricity Regulatory Commission (KERC) has raised the electricity tariff by 5.40%, which is being passed on to end-users in the midst of the pandemic, putting pressure on domestic and industrial consumption. Ganagaraju, a landowner, has applied for a 3 MW solar power project as part of the solar program initiated by Karnataka Renewable Energy Development Limited (KREDL). The project was entrusted to him. The Karnataka Electricity Regulatory Commission (KERC) has approved a tariff of Rs 8.40/kWh for a 3 MW solar power project by Cambria Solar Private Limited. In accordance with Solar Policy 2014-21, the project was awarded by Karnataka Renewable Energy Development Limited (KREDL) under the SRTPV programme on 17 March 2015. Experts believe that, given the decline in industrial consumption as a result of COVID-induced stress, the government should offer the electricity industry at a cheaper price instead of raising the tariff. The developer said it was entitled to a tariff of ₹8.40 (~$0.115)/kWh, according to the PPA.

Under the PPA, the proponent had the right to install a special purpose vehicle (SPV) after the implementation of the PPA. As a result, Cambria Solar was established as an SPV. The regulator noted that the applicant was entitled to the tariff of ₹8.40 (~$0.115)/kWh from the date of commercial operation, as it had implemented the project within the extended timeframe. Due to the “force majeure” event, the project could not be commissioned within 18 months of the effective date. Biomass PPA Project (.doc)169.5 KB, Wind Turbine PPA Project (PDF)243.59 KB KerC approved the above order after Cambria Solar submitted a petition asking the Commission to approve the Rs 8.40/kWh tariff from the date of commercial operation of the project for the duration of the PPA. It also requested that the extension granted by BESCOM of the Planned Commercial Exploitation Date (SCOD) agreed between the parties be approved by six months. Then, the developer requested a six-month extension starting January 6, 2017, which is perceived as SCOD. KPTCL issued the evacuation permit to the applicant. Subsequently, BESCOM granted a six-month extension of scod under the PPA, subject to the extension of the bank guarantee. The developer said it was entitled to a rate of ₹8.40/kWh, according to the PPA.

Read also: In “taming” Surappa, the TN government shows the Center that the boss Cambria Solar had submitted a petition asking the Commission to approve the six-month extension granted by BESCOM until the planned commercial exploitation date (SCOD), as agreed between the parties. It had also requested the Commission to approve the tariff of ₹8.40 (~$0.115)/kWh from the date of commercial operation of the project for the duration of the PPA. Gangaraju, a farmer landowner, applied for the award of a solar project under that programme and the said 3 MW proposal was accepted and the project was awarded to Gangarju by KREDL`s allocation letter dated 17 March 2015. . . . .