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BEFORE THE GUJARAT ELECTRICITY REGULATORY COMMISSION

GANDHINAGAR

Petition No.1450/2014.

In the Matter of:

Petition for adjudication of the dispute between the petitioner andrespondent and directing the respondents to (i) to allow the petitioner toconnect the Solar PV Power Project of 0.750 MW with the distributionnetwork of Respondent No. 2 (MGVCL), (ii) to direct GEDA and otherrespondents to grant commissioning of the project and accreditate andregister the petitioner Solar Power Project under REC Scheme.

Petitioner : Kaizen Switchgear Products,A Partnership Firm,Having Office at Plot No. 866/1, GIDC Estate,Makarpura, Vadodara.Represented By : Learned Senior Advocate Shri Saurabh Soparkarwith Advocate Shri Ashish Jha.

V/s.Respondent No. 1 : Gujarat Energy Development Agency,4th Floor, Block No. 11 & 12,Udyog Bhavan, Sector-11,Gandhinagar- 382017, Gujarat.Represented By : S/Shri S.B. Patil with Rakesh Arya.Respondent No. 2 : Madhya Gujarat Vij Company Limited,Sardar Patel Vidhyut Bhawan,Race Course Circle, Vadodara-390007.Represented By : Smt. U.V.Parmar.

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Respondent No. 3 : Gujarat Energy and Transmission Corp. Limited,Sardar Patel Vidyut Bhavan, Race Course Circle,Vadodara-390007.Represented By : Learned Advocate Shri M.G. Ramchandranalongwith Ms. Venu Birappa and Shri S.H.Upadhay.Respondent No. 4 : The Chief Electrical Inspector,4th Floor, Block No. 11 & 12,Sector -11, Udhyog Bhavan,Gandhinagar – 382017.Represented By : Shri M.N. Raval.And

Petition No.1451/2014.

In the Matter of:

Petition for adjudication of the dispute between the petitioner andrespondent and directing the respondents to (i) to allow the petitioner toconnect the Solar PV Power Project of 0.500 MW with the distributionnetwork of Respondent No. 2 (MGVCL), (ii) to direct GEDA and otherrespondents to grant commissioning of the project and accreditate andregister the petitioner Solar Power Project under REC Scheme.

Petitioner : Electrical Control and Systems,Plot No. 866/2 and 5,GIDC Industrial Estate,Makarpura, Vadodara.Represented By : Learned Senior Advocate Shri Saurabh Soparkarwith Advocate Shri Ashish Jha.V/s.

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Respondent No. 1 : Gujarat Energy Development Agency,4th Floor, Block No. 11 & 12,Udyog Bhavan, Sector-11,Gandhinagar- 382017, Gujarat.Represented By : S/Shri S.B. Patil with Rakesh Arya.Respondent No. 2 : Madhya Gujarat Vij Company Limited,Sardar Patel Vidhyut Bhawan,Race Course Circle, Vadodara-390007.Represented By : Smt. U.V.Parmar.Respondent No. 3 : Gujarat Energy and Transmission Corp. Limited,Sardar Patel Vidyut Bhavan, Race Course Circle,Vadodara-390007.Represented By : Learned Advocate Shri M.G. Ramchandranalongwith Ms. Venu Birappa and Shri S.H.Upadhay.Respondent No. 4 : The Chief Electrical Inspector,4th Floor, Block No. 11 & 12,Sector -11, Udhyog Bhavan,Gandhinagar – 382017.

Represented By : Shri M.N. Raval.And

Petition No.1452/2014.

In the Matter of:

Petition for adjudication of the dispute between the petitioner andrespondent and directing the respondents to (i) to allow the petitioner toconnect the Solar PV Power Project of 0.250 MW with the distributionnetwork of Respondent No. 2 (MGVCL), (ii) to direct GEDA and other

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respondents to grant commissioning of the project and accreditate andregister the petitioner Solar Power Project under REC Scheme.

Petitioner : Baroda Mould & Dies,Plot No. 48 &30, 31, 32,GIDC Industrial Estate,Makarpura, Vadodara.Represented By : Learned Senior Advocate Shri Saurabh Soparkarwith Advocate Shri Ashish Jha.V/s.Respondent No. 1 : Gujarat Energy Development Agency,4th Floor, Block No. 11 & 12,Udyog Bhavan, Sector-11,Gandhinagar- 382017, Gujarat.Represented By : S/Shri S.B. Patil with Rakesh Arya.

Respondent No. 2 : Madhya Gujarat Vij Company Limited,Sardar Patel Vidhyut Bhawan,Race Course Circle, Vadodara-390007.Represented By : Smt. U.V.Parmar.Respondent No. 3 : Gujarat Energy and Transmission Corp. Limited,Sardar Patel Vidyut Bhavan, Race Course Circle,Vadodara-390007.Represented By : Learned Advocate Shri M.G. Ramchandranalongwith Ms. Venu Birappa and Shri S.H.Upadhay.Respondent No. 4 : The Chief Electrical Inspector,4th Floor, Block No. 11 & 12,Sector -11, Udhyog Bhavan,Gandhinagar – 382017.

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Represented By : Shri M.N. Raval.CORAM:

Shri K. M. Shringarpure, Member

Shri Pravinbhai Patel, Chairman

Date: 13/02/2015.

DAILY ORDER

1) The matter was kept for hearing on 31.01.2015. The facts of all the three cases and prayersought by the petitioners are similar in nature. Hence, we decide to deal with all threematters together and pass a common order in it.2) Learned advocate Shri Saurabh Soparkar, on behalf the petitioners, submitted that thepetitioners had approached GEDA i.e. Respondent No. 1 on 07.09.2012 for in principleapproval to set up Solar Power Plant under REC mechanism notified by the CERC atfollowing places with different capacities and utilize energy generated from it for captiveuse at their respective industries as stated in the table below:

Sr. No. Petitioner’ Name MWcapacity Place of Project01. Kaizen Switchgear Products 0.750 Village: Pisai, Taluka:Dabhoi, Dist. Vadodara.02. Electrical Control and Systems 0.500 Village: Pisai, Taluka:Dabhoi, Dist. Vadodara.03. Baroda Mould & Dies 0.250 Village: Pisai, Taluka:Dabhoi, Dist. Vadodara.

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2.1. He further submitted that the GEDA vide its letter dated 12.09.2012 sought certaininformation in the prescribed formats and also demanded certain documents and statedthat on receipt of the application, GEDA will process the same for facilitating the petitionerto approach GETCO/Discoms for grid connectivity of the project and end use of theelectricity. Application for accreditation may be made subsequent to consent for gridconnection and end use of electricity from the concerned agencies.2.2. GEDA had vide its letter dated 28.01.2013 informed GUVNL, GETCO and MGVCL that thepetitioner is setting up Solar PV Power plant at different places for different capacities asstated above under REC Mechanism and forwarded the application to the above companiesfor grid connectivity and end use of electricity. It is also stated that the expenses for powerevacuation shall be borne by the project developer.2.3. The petitioner had also informed the Respondent No. 2 MGVCL that they are setting up theSolar Power Plant at different location with different capacities under REC Mechanism andthey desire to wheel the energy generated from it with a request to provide the connectivityto their projects. It was also intimated by the petitioner to MGVCL that they agree to pay allrelevant charges, which are required to be paid by the petitioner. The petitioner also paidnecessary charges for testing and installation of the ABT compliant Meter as directed by theMGVCL. The petitioner had also paid the infrastructure cost required and supervisioncharges for it as demanded by MGVCL.2.4. The petitioners had given EPC contract to the M/s. Green Brilliance Energy Private Limitedto set up the Solar Power Project, on behalf of the petitioners at a cost as stated below.

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Sr. No. Petitioner’ Name MWcapacity Cost of Project (In Rs.)01. Kaizen Switchgear Products 0.750 7,32,28,000/-02. Electrical Control and Systems 0.500 5,13,75,000/-03. Baroda Mould & Dies 0.250 2,42,36,000/-

2.5. The EPC contractors have completed the construction activities of the project and providedthe completion certificates specifying that the plants are ready for commissioning on31.03.2014. The petitioner had approached the Chief Electrical Inspector (CEI) on11.06.2013 requesting him to approve the drawing for setting up the plant. However, theCEI did not approve the same despite the reminders dated 08.08.2013, 07.03.2014, and12.07.2014. However, the CEI vide letter dated 20.08.2014 informed the petitioners toobtain NOC from the distribution licensees for setting up the plant and provide the gridconnectivity. He submitted that the CEI’s role is to approve the electrical drawing withconsideration of the safety aspects as per the CEA Regulations. The petitioner stated thatCEI failed to perform its duty and till date did not approve the drawings, and did not grantapproval for energization of plant.2.6. He further submitted that as per the demand of the MGVCL, the petitioner had paid Rs.1,00,000 with application for grid connectivity and also provided an undertaking forstandard of connectivity to distribution systems and also provided relevant documents forit. He further submitted that MGVCL raised the issue that the capacity of solar power plantproposed by the petitioners is higher than the connected load at consumption place of thepetitioners and asked the petitioner to increase it consumption or reduce the capacities ofthe plant and give its confirmation on the above issues. The petitioner from time to time

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clarified that the plant set up by it is with consideration of its future requirements and theenergy which is generated and injected into the grid and wheeled for captive use. If anysurplus energy is available after set-off at consumption place, such surplus energy begoverned by the regulations and order passed by the Commission.2.7. Learned advocate Shri Saurabh Soparkar, on behalf of the petitioner, further submitted thatthe petitioner undertakes that if any surplus energy is available after set off, it would begoverned by the provisions of Regulations and orders of the Commission. The petitionerintended the captive use of such energy and wants REC for energy injected into the grid asper the CERC Regulations. Therefore, there is no question to burden the Discoms on theabove grounds.2.8. He further submitted that the MGVCL had also provided a tripartite agreement to be signedbetween the petitioner, MGVCL and GETCO. The said tripartite agreement was signed by thepetitioner and MGVCL. However, GETCO denied to sign the tripartite agreement on theground that no government policy exists allowing to set up the solar power project underREC mechanism and captive use. The said denial by the GECTO is against the provisions ofthe Electricity Act, 2003 and regulations framed by the Commission under it.2.9. He further submitted that as per section 7 of Electricity Act, 2003, the generation of theelectricity is a de-licensed activity. There is no need to take license for the generation ofelectricity. Section 9 of the Act provides that any person is empowered to set up captivegenerating plant and wheel energy generated from it to its consumption point by theutilization of transmission and/or distribution system of the licensee concerned. He alsosubmitted that section 10 of the Act provides that any person is entitled to establish,operate and maintain the generating stations and dedicated transmission line connectedwith it. The generating company may supply the electricity to the licensee or the consumer

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as per the provisions of the Act. He also referred section 39 of the Act which states that theState Transmission utility shall allow non-discriminatory open Access to the transmissionsystem to any generating company or licensee. Section 42 (2) of the Act provides that thedistribution licensee shall provide Open access of its network by charging wheeling charges.He submitted that the aforesaid sections provide that the distributionlicensee/transmission licensees shall allow the connectivity as well as open access to itsnetwork to the generating company or captive generating plant.2.10. He submitted that GEDA had denied accreditation and registration of the petitioner’sprojects under REC scheme on the ground that there is no government policy which allowsthe solar power project under REC mechanism for captive use. In support of the abovesubmission, he stated that GEDA relied upon the letter dated 26.08.2013 of DeputySecretary, E&P Department, Government of Gujarat which talks about the Solar PowerProject of maximum capacity of 100 MW and who desires to sell the energy generated fromthe project to the distribution licensees through PPA. However, in the present case, thepetitioner is setting up Solar Power Project under REC Mechanism for captive use of energygenerated from it. Therefore, denial by GEDA is illegal and arbitrary.2.11. Based on the above submissions, he submitted that the petitioner restricts the presentpetition for directing the respondents to grant the connectivity to the petitioner projects,CEI to approve the drawing submitted by the petitioners, GEDA to carry out thecommissioning activities and accreditation of the project under REC mechanism onapplication submitted by the petitioner and the respondents MGVCL and GETCO to allowtransmission/wheeling of the power generated from the project for captive use and alsosign the tripartite agreement. The petitioner is not pressing for the compensation prayed by

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him in the present petition with a liberty to approach the Commission in future, if thepetitioner thinks necessary.3) Shri M.N. Raval on behalf the CEI, submitted that the drawings were not approved by theCEI office as the petitioner had not submitted the No Objections Certificate (NOC) ofdistribution licensees for grid connectivity. In absence of grid connectivity beforeInspection, it is not feasible to grant the approval of drawing and energization of the SolarPower Plants. He further submitted that in number of cases, the grid connectivity to SolarPower Plant has not been given even though the drawings were approved by the CEI.Therefore, the drawings are not approved without grid connectivity and no objectioncertificate issued by the Discoms. It is further submitted that in case of TPL, the gridconnectivity was granted by the TPL for Solar Power Project and therefore the CEI officeapproved the drawings and granted permission for energization. As the petitioner failed toprovide confirmation for grid connectivity for Solar Power Plant of MGVCL, the office of CEIdid not grant the permission for energization and did not approve the drawings under thesafety regulations.4) Shri S.B. Patil, on behalf of the GEDA, submitted that the GEDA has not granted the approvalof different capacities of the Solar PV Power Projects of the petitioners under the RECschemes + Captive use of energy as no grid connectivity was granted by MGVCL and GETCOto these projects. He further submitted that no transmission/wheeling agreements betweenthe petitioners, MGVCL and GETCO are executed. Therefore, in the absence oftransmission/wheeling agreement, it is not possible to commission of the project and grantthe commissioning certificate.

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4.1. He has further submitted that GEDA is a Government organization and working inconcurrence of GoG policies. As per GoG letter dated 26.08.2013, it was communicated toGEDA that “the Power Generated from the Solar Power Plant set up under REC mechanismwith PPA with Discoms shall not be eligible either for captive use or to sell power to thethird party”. In view of the above guidelines of Government of Gujarat, GEDA was unable toproceed in the aforesaid matter.4.2. He further submitted that the Solar Power Project can be commissioned upon gettingconnectivity with state grid and certificate issued by CEI approving drawing and grantingthe permission for energization which was not submitted by the petitioner. Hence, thequestion of commissioning does not arise.4.3. GEDA vide letter dated 12.09.2012 informed to the petitioner that the end use of electricitybe consented by the concerned authorities i.e. STU and MGVCL. He submitted thataccordingly GEDA had forwarded the application of the petitioner to GUVNL, GETCO, andMGVCL on 28.01.2013 for grid connectivity and end use of electricity for theirconsideration. However, the petitioner has not submitted any consent/wheeling agreementexecuted with GETCO and MGVCL.4.4. He further submitted that though the petitioner had approached for registration of projectunder REC scheme about 2 years back, but the application for registration was submittedonline only on 25.08.2014 to GEDA alongwith necessary fees. Without applying forregistration of the project under REC scheme and requesting GEDA to allocate theaccreditation number is not possible. There is no default on the part of GEDA to accreditateand registration of the project and grant the approval for the same.

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4.5. On query of the Commission that if the drawings of plant and energization of plant isapproved by the CEI and the connectivity with the grid is granted by MGVCL and GETCO andthe transmission/wheeling agreement is signed, within how much time GEDA would carryout the activities for commissioning of the project, he submitted that GEDA will completecommissioning activities within 7 days after the grant of connectivity by the distributionlicensees and signing of the transmission/wheeling agreement by GETCO and MGVCL.5) Learned Advocate Shri M.G. Ramchandran, on behalf of the Respondent No. 2 MGVCL andRespondent No. 3 GETCO, submitted that as far as the connectivity of Solar Power Plant isconcerned, MGVCL agreed to grant the connectivity as the petitioner desires to wheel theenergy generated from it at 11 KV level. MGVCL has also inspected ABT Compliant Meter tobe installed at the petitioner’s place. MGVCL has also signed the tripartite agreement to beexecuted amongst MGVCL, GETCO and petitioners. The connectivity is not granted as thereis no approval of electricity drawing of plant and approval of electrical inspector forenergization of plant. Moreover, there is no accreditation and registration of the projectunder REC scheme and approval given by GEDA for the Solar Power Project of the petitionerunder REC mechanism plus captive use of energy. He further submitted that as far asMGVCL is concerned, they do not want to purchase any surplus energy available after set-offat consumption place because they do not need it.

5.1. He further submitted that there is no role of GETCO in the present case because the plant isconnected at 11 KV and wheeling of energy from it is at 11 KV level in the same distributionlicensee area of MGVCL. As far as tripartite agreement is concerned, GETCO is required tosign the same because 11 KV feeders are emanating from GETCO S/S and to that extent thetransmission system associated with wheeling of energy comes into picture. He furthersubmitted that GETCO has agreed to sign the tripartite agreement provided by MGVCL.

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5.2. On query of the Commission that after approval of the drawing and permission forenergization of plant by CEI, within how much time MGVCL would give the connectivity tothe petitioner’s plant and MGVCL & GETCO sign the tripartite agreement and provide thesame to the petitioner, he submitted that the above activities would be carried out byMGVCL and GETCO within 7 days.6) We have carefully considered the submissions made by the parties in the present case. Wefound that the petitioner had approached the respondents to allow setting up of SolarPower Projects under REC Mechanism and allow the wheeling of the energy generated fromit for captive use. The petitioners had initially approached the respondents September 2012onwards and requested from time to time for (i) approval of electrical drawings,energization of the plant by CEI, (ii) approval of connectivity with the grid by MGVCL,tripartite agreement signed between the petitioner, GETCO and MGVCL fortransmission/wheeling of the energy generated from the project for captive use atpetitioner’s place and also (iii) approval from GEDA for registration, accreditation of theproject under REC mechanism plus captive use of energy scheme as per CERC regulationsand carry out work related to the commissioning of the project and issue certificate for it.The petitioner has incurred huge amount of expenditure on these projects as stated in para2.4 above. The plant of the petitioner is ready for commissioning since 31.03.2014.However, on one or other pretexts, approvals were not granted by the respondents’authorities for which they are empowered. Due to the above, the petitioner‘s project is notcommissioned and the petitioner is deprived of the captive use of the energy generatedfrom it and earn RECs for the energy generated and injected into the grid by the petitioner.Moreover, the petitioner has also suffered by way of payment of interest on loan and notable to receive the accelerated depreciation benefit for the year 2013-2014 as per the

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provisions of Income Tax Act, 1961 due to individual and collaborative actions of therespondents.6.1. Here it is necessary to mention that the Electricity Act, 2003 enacted by the Parliament topromotes competition in the Electricity industry and promotion of efficient andenvironmental benign policy. Section 2 (8) of the Electricity Act, 2003 which states thedefinition of captive generating plant, section 7 of the said Act which pertains to generatingcompany and requirement for setting up of the generating stations and section 9 of the saidAct state about captive generating plant which are relevant to refer in the present case arereproduced as under:

“……………………..

2. Definitions

In this Act, unless the context otherwise requires,--……………..

(8) Captive generating plant" means a power plant set up by any person togenerate electricity primarily for his own use and includes a power plant setup by any co-operative society or association of persons for generatingelectricity primarily for use of members of such co-operative society orassociation;

………………………………………

7. Generating company and requirement for setting up of generating station

Any generating company may establish, operate and maintain a generatingstation without obtaining a licence under this Act if it complies with the technicalstandards relating to connectivity with the grid referred to in clause (b) of section73.

9. Captive generation

(1) Notwithstanding anything contained in this Act, a person may construct,maintain or operate a captive generating plant and dedicated transmission lines:

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PROVIDED that the supply of electricity from the captive generating plantthrough the grid shall be regulated in the same manner as the generating stationof a generating company.

(2) Every person, who has constructed a captive generating plant and maintainsand operates such plant, shall have the right to open access for the purposes ofcarrying electricity from his captive generating plant to the destination of his use:

PROVIDED that such open access shall be subject to availability of adequatetransmission facility and such availability of transmission facility shall bedetermined by the Central Transmission Utility or the State Transmission Utility,as the case may be:

PROVIDED FURTHER that any dispute regarding the availability of transmissionfacility shall be adjudicated upon by the Appropriate Commission.

……………………………”

Section 2 (8) of the Electricity Act, 2003 defines captive generating plant means power plantset up by any person to generate electricity primarily for own use.Section 7 of the Electricity Act, 2003 says that the generation activity is a de-licensedactivity and no license is required by the generating companies for the same. It has only tocomply with technical standards relating to connectivity with grid referred to in clause (b)of section 73 of the Act. Thus, the generation of the electricity is a delicensed activity andonly requirement is to fulfill the technical standards specified by CEA as per section 73 (b)of the Act.Section 9 (i) of the Act provides that a person may construct, maintain or operate thecaptive generating plant and dedicated transmission line associated with it. The proviso tothe said section of the Act provides that the supply of electricity from such plant throughgrid shall be regulated in the same manner as the generating station of a generatingcompany.

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Section 9 (ii) provides that the captive generating plant shall have right to Open Access forpurpose of carrying energy from his captive generating plant to destination of his use.Moreover, the proviso of the said section provides that the open Access shall be subject toadequate transmission facility availability as determined by the Central transmissionUtility/State Transmission Utility (CTU/STU) as the case may be.6.2. On cogent reading of the above sections of the Act, it transpires that the generation ofelectricity is a delicensed activity subject to compliance with technical standards related togrid connectivity. Moreover, any person can set up the CGP and dedicated transmissionlines. The CGP holder is eligible for Open Access for transmission/wheeling of the energygenerated from the CGP for captive use subject to availability of capacity intransmission/distribution network.6.3. We note that as per the provisions of the Electricity Act, 2003 and rules framed undersection 73 of the Act by the Central Electricity Authority (CEA), the Electrical Inspector isrequired to approve the electrical drawings of the power plant and also to approve theenergization of the power plant with consideration of safety aspect. There is no need of gridconnectivity of the project while approving the drawing and granting the energization of theproject.6.4. We also note that the approval of electrical drawing of the power plant and energization ofit with consideration of safety aspects is different and distinct from the grant of theconnectivity to the transmission/distribution system. The contention of the Chief ElectricalInspector that there is no grid connectivity granted by MGVCL and transmission/wheelingagreement is not signed due to which the electrical drawings and energization of the projectnot granted by CEI to the present petitioners by the CEI, is illegal and invalid. Thus, the

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denial of approval of drawings and energization of the power plant by CEI is arbitrary andnot consistent with the provisions of the Act. It is the duty of the CEI to approve theelectrical drawing and energization of the power project set up by the petitioners with theconsideration of the safety aspect as per the CEA regulations.6.5. Shri M.N. Raval on behalf of the CEI admitted before the Commission that the CEI willexamine the electrical drawing submitted by the petitioner and also inspect the powerproject of the petitioners and grant the approval. We, therefore, direct the CEI to verify theelectrical drawing submitted by the petitioners and also inspect the petitioners’ plants andgrant the approvals strictly within 7 days from the date of this order.6.6. We note that the Commission has notified the GERC (Terms and Conditions of Intra-StateOpen Access) Regulations, 2011. The application for connectivity with transmission licenseespecified in regulation 6, application for connectivity with distribution licensees specified inregulation 7, process of the application and grant of connectivity to distribution systemstated in regulation 8, general provision for Open Access specified in regulation 9 of the saidregulations, which are relevant in this case.

“……………………….

6. Processing of Application and Grant of connectivity by STU

(1) On receipt of the application, the STU shall, in consultation and through

coordination with other agencies involved in the intra-State transmission, process the

application and carry out the necessary interconnection study as specified in the

Central Electricity Authority (Technical Standards for Connectivity to the Grid)

Regulations, 2007.

(2) While granting connectivity, the STU shall specify the name of the sub-station or

pooling station or switchyard where connectivity is to be granted. In case connectivity

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is to be granted by looping-in and looping-out of an existing or proposed line, the STU

shall specify the point of connection and name of the line at which connectivity is to be

granted. The STU shall indicate the broad design features of the dedicated

transmission line and the timeframe for completion of the dedicated transmission line.

(3) The applicant and all intra-State transmission licensees including the State

Transmission Utility shall comply with the provisions of Central Electricity Authority

(Technical Standards for Connectivity to the Grid) Regulations, 2007.

(4) The applicant shall sign a connection agreement with the State Transmission

Utility or intra-State transmission licensee owning the sub-station or pooling station

or switchyard or the transmission line as identified by the STU where connectivity is

being granted:

Provided that in case connectivity of a generating station, including captive

generating plant or consumer is granted to the intra-State transmission system of an

intra-State transmission licensee other than the State Transmission Utility, a tripartite

agreement as provided in the Central Electricity Authority (Technical Standards for

Connectivity to the Grid) Regulations, 2007 shall be signed between the applicant, the

State Transmission Utility and such intra-State transmission licensee.

(5) The grant of connectivity shall not entitle an applicant to interchange any power

with the grid unless it obtains long-term access, medium-term open access or short-

term open access in accordance with the provisions of these regulations.

Provided that any interchange of power with grid without any type of open access

shall be violation of these regulations and shall be dealt with in accordance with

section 142 of the Electricity Act, 2003.

Provided further that provisions of this regulations shall not be applicable to energy

exchange taking place under regulation 6(6) below.

(6) A generating station, including captive generating plant which has been granted

connectivity to the grid shall be allowed to undertake testing including full load testing

by injecting its infirm power into the grid before being put into commercial operation,

even before availing any type of open access, after obtaining permission of the State

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Load Despatch Centre, which shall keep grid security in view while granting such

permission. Commercial treatment of such infirm power from a generating station or a

unit thereof, other than those based on non-conventional energy sources, the tariff of

which is determined by the Commission, will be governed by the Regulations on Terms

and Conditions of Tariff notified by the Commission from time to time. The power

injected into the grid from other generating stations as a result of such testing shall be

charged at the UI rates notified by the Commission from time to time.

(7) An applicant may be required by the State Transmission Utility to construct a

dedicated line to the point of connection to enable connectivity to the grid, unless

exempted by the Commission for reasons to be recorded in writing.

(8) The STU shall convey its decision on grant of connectivity or otherwise within a

period of 60 days from the date of receipt of application.

7. Application procedure for Connectivity to distribution system by a generating

station

(1) All eligible generating stations including a captive generating plant, seeking

connectivity to a distribution system, shall apply to the distribution licensee for

connectivity in the Form prescribed in the procedure to be laid down by the

Distribution Licensee.

(2) The Application shall be accompanied by a non-refundable fee of Rs. one lakh in

favour of the distribution licensee concerned, in the manner as specified by the

licensee.

(3) The application for connectivity shall contain details such as, proposed

geographical location of the generating station, quantum of power to be injected and

such other details as may be laid down by the distribution licensee concerned in the

procedure.

8. Processing of Application and Grant of connectivity to distribution system by a

generating station

(1) On receipt of the application, the distribution licensee shall, in consultation and

through coordination with State Transmission Utility, process the application and

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carry out the necessary inter-connection study as specified in the Central Electricity

Authority (Technical Standards for Connectivity to the Grid) Regulations, 2007.

(2) While granting connectivity, the distribution licensee shall specify the name of the

sub-station or pooling station or switchyard where connectivity is to be granted.

(3) The distribution licensee shall indicate the broad design features such as

switchyard and interconnection facility upto the point of injection into the Substation

of the distribution licensee and the timeframe for completion of the same. The cost of

creation of these facilities shall be borne by the Generating Company. In cases where

augmentation of the distribution licensee’s sub-station is involved, the generating

station shall also bear the cost of bay, breaker in the distribution licensee’s sub-

station and equipment for inter-connection of real time data to SLDC.

(4) The applicant and the distribution licensee shall comply with the provisions of

Central Electricity Authority (Technical Standards for Connectivity to the Grid)

Regulations, 2007.

(5) The applicant shall sign a connection agreement with the distribution licensee

where connectivity is being granted.

(6) The grant of connectivity shall not entitle an applicant to interchange any power

with the grid unless it obtains long-term access, medium-term open access or short-

term open access in accordance with the provisions of these regulations.

Provided that any interchange of power with grid without any type of open access

shall be violation of these regulations and shall be dealt with in accordance with

section 142 of the Electricity Act, 2003.

Provided further that provisions of these regulations shall not be applicable to energy

exchange taking place under regulation 8(7) below.

(7) A generating station, including captive generating plant which has been granted

connectivity to the distribution system shall be allowed to undertake testing including

full-load testing by injecting its infirm power into the grid before being put into

commercial operation, even before availing any type of open access, after obtaining

permission of the State Load Despatch Centre and the distribution licensee, who shall

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keep grid security in view while granting such permission. The infirm power injected

from such generating station into the transmission and/or distribution system shall

be compensated to the extent of the actual fuel cost and secondary fuel cost as the

case may be incurred by the generator.

9. Eligibility for Open Access and conditions to be satisfied

(1) Subject to the provisions of these regulations, the licensees, generating companies,

captive generating plants and consumers shall be eligible for open access to the intra-

State transmission system of the State Transmission Utility or any transmission

licensee on payment of transmission and other charges as may be determined by the

Commission in accordance with Chapter 6 of the these regulations.

(2) Subject to the provisions of these regulations, the licensees, generating stations,

captive generating plants and consumers shall be eligible for open access to

distribution system of a distribution licensee on payment of the wheeling and other

charges as may be determined by the Commission in accordance with Chapter 6 of the

these regulations.

(3) Subject to the provisions of these regulations, open access shall be permissible to

the consumers seeking open access for a capacity of 1 MW and above.

Provided that when a person, who has established a captive generating plant, opts for

open access for carrying the electricity to the destination of his own use, the limitation

of 1 MW shall not be applicable.

Provided further that duties of the distribution licensee with respect to such open

access customers shall be of a common carrier providing non-discriminatory open

access as per section 42(3) of the Act.

Provided that the Commission may allow open access to consumers seeking open

access for capacity less than 1 MW at such time as it may consider feasible having

regard to operational constraints and other factors.

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(4) A person having been declared insolvent or bankrupt or having outstanding dues

against him for more than two months billing of distribution/transmission licensee at

the time of application shall not be eligible for open access.

(5) The open access customer shall have to install Intra-state ABT Compliant meters at

their place for energy accounting and Remote Terminal Unit (RTU) to facilitate SLDC

in real time monitoring, which shall be duly certified by the licensee concerned.

……………………….”

As per the regulations 6 & 7, the generating station or CGP has to apply for the connectivityin the prescribe format laid down by the distribution licensee alongwith non-refundablefees of Rs. 1 Lakh in favour of distribution licensees. The application for connectivitycontains the details of the location of generating station, quantum of power to be injectedand other details as laid down by the distribution licensees.From the above regulations, it is clear that a duty is cast upon the distribution licensees togrant the connectivity to the generator/ CGP in compliance of regulation 6, 7 and 8 of thesaid regulations. Regulation 6 of the said regulations provides for processing of theapplication for connectivity by the transmission licensees to grant the connectivity to thegenerator. Regulation 7 of the GERC (Terms and Conditions of Intra-State Open Access)Regulations, 2011 provides for application to Discoms for connectivity. Regulation 8specifies the procedure to be followed while granting the connectivity by the concernedlicensee. Hence, according to the aforesaid regulations, once the applicant submits theapplication with relevant details and fulfills the condition for connectivity, the same isrequired to be granted by the licensees.Regulation 9 specifies the conditions required to be fulfilled by the Open Access customers.According to aforesaid regulations, a person who is declared insolvent or bankrupt or

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having outstanding dues against him for more than two months billing of thedistribution/transmissions licensee shall not be eligible for Open Access. Moreover, theOpen Access customer is required to install Intra-State ABT compliant meter for energyaccounting and remote terminal unit to facilitate the SLDC in real time monitoring dulycertified by the licensee.6.7. In the present case, we note that the petitioners have already submitted the connectivityagreement in prescribed format given by the distribution licensees alongwith theundertaking and paid Rs. 1 Lakh as the fees for the same. Thus, they have complied withgrid connectivity conditions specified in the Act.6.8. We also note that the captive generating plants of Solar PV set up by the petitioners arehaving very low capacity below 1 MW. It is also renewable source of energy which isrequired to be promoted by the Commission as envisaged in the preamble to the Act andsection 86 (1) (e) of the Act. We also note that the petitioners have complied withconditions for connectivity of the plant. However, MGVCL and GETCO both have not grantedthe connectivity on the ground that there is no approval of drawings and permission of CEIfor energization of the project.

6.9. In the present case, we note that the petitioner’s plants are connected with the distributionnetwork and wheeling of the power is also on the distribution network. Also, the necessaryconditions for connectivity and the requirement of open access conditions are fulfilled.However, MGVCL had denied to grant connectivity and open access which is an act ofviolation of regulation 6, 7, 8 and 9 of the Open Access Regulations which are statutoryregulations notified by the Commission and also violation of provisions of section 2 (8),section 7, section 8, section 9 read with section 42 (2) of the Act.

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6.10. The denial of connectivity by MGVCL on the ground of non approval by GEDA foraccreditation of the project under REC mechanism and non-approval of energization of theproject by the CEI is also illegal and in violation of the provision of the regulations 6, 7, 8and 9 of GERC (Terms and Conditions of Open Access) Regulations, 2011 notified by theCommission because the connectivity of the power project is required to be granted by thedistribution licensee with consideration of condition specified in regulations 7 and 8 of theOpen Access regulations. It has no linkage with the approval of GEDA for registration of theproject under REC mechanism.6.11. We also note that during the hearing, learned advocate Shri M.G. Ramchandran fairlyadmitted that the GETCO has no role for grid connectivity and wheeling of energy. However,there is no correspondence on record with GETCO for clarification on the above aspects topetitioner. But GETCO vide its Letter No. SE (R&C)/EE-C/GETCO/VB/1052 dated30.07.2014 informed to the petitioner that the connectivity and Bulk Power TransmissionAgreement would be possible only after grant of approval by the Government of Gujarat andGEDA for its project under captive and REC mechanism. It is also stated that there is policyof the Government of Gujarat, for setting up Solar PV Power Plant under captive with RECmechanism and therefore, GETCO cannot process the petitioner’s proposal. It is also advisedby GETCO to the petitioner to get the approvals from GEDA/GoG after which theapplications for connectivity and Open Access can be processed. In the absence offulfillment of these requirements, GETCO refused to sign agreement. The above guidance ofGETCO to the petitioners proves that it has misled the petitioner regarding (i) approval foropen access, (ii) grant of connectivity and (iii) signing of the agreement as stated in earlierpara as the petitioner’s plant is connected with distribution network and petitioners desireof wheeling the energy at 11 KV level and thus, the question of connectivity with GETCO

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system does not arise. Moreover, as stated in earlier para, the connectivity of the plant andgrant of open access which is statutory as provided in the Act to the person by GECTO is inviolation of the sections 2(8), 9, 39, 42 (2) of the Electricity Act, 2003 read with regulation6,7, 8 and 9 of GERC (Terms and Condition of Intra-State Open Access) Regulations, 2011which does not contemplate that the power project set up under captive and REC mode isrequired to obtain an approval of GEDA and also fulfill the criteria of Government policy.6.12. We note that during the hearing, learned advocate Shri M.G. Ramchandran, on behalfMGVCL and GETCO, admitted that on grant of the approval for energization of the project bythe CEI, the respondent MGVCL would grant the connectivity immediately within a weekand respondent MGVCL and GETCO would sign the tripartite agreement forwheeling/transmission of the energy, within 7 days. We, therefore, direct the respondentsMGVCL to grant the connectivity within 7 days after approval of drawing and permission forenergization of the project is given by the CEI and to sign the tripartite agreement byMGVCL and GETCO and comply the same by the next date of hearing.6.13. We also observed that the action of GEDA who is nodal agency for registration andaccreditation of RE Projects, denied for registration and accreditation of the project underREC mechanism with captive use of energy generated from it and commissioning of theproject on the ground of (i) no connectivity of the project and (ii) no policy to set up thesolar power plant under REC mechanism with captive use, is contrary to the content ofletter No. GDA-11-2012-994 – B dated 26.08.2013 addressed by the Dy. Secretary, E&PDepartment, Government of Gujarat to GEDA, GUVNL and GETCO. The relevant portion ofthe above letter is reproduced as under:

“…………………………

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(A) Solar REC Projects:

(1) A Maximum of 100 MW of solar power plant be allowed for installation in the Stateof Gujarat under the REC mechanism for sale of power to the distribution companies.

…………

(4) The Power generated from the solar power plant set up under REC mechanism withPPAs with DISCOM shall not be eligible either for captive use or sale to third party.

……………………..”

6.14. On reading of the above letter, it proves that the said letter is about the setting up amaximum 100 MW Solar Power Plant for installation in a State of Gujarat under RECmechanism for selling the power to the distribution companies at APPC rate. It also statesthat the power generated from solar power plant under REC mechanism with PPA withDiscoms shall not be eligible for captive use or sell energy to the third party. The aforesaidprovision is with respect to the Solar Power Plants having PPA with DISCOMS and thereforeis not applicable to the Solar Power Plants set up under REC mechanism for captive use.Once, the PPA is executed by the project developers, they are not entitled to use such energyfor captive purpose or sell to third party. Therefore, the contention of the respondent GEDAthat government policy is restricting the setting up solar power project under RECmechanism for captive use is not valid and there is wrong interpretation of the letter of Dy.Secretary, E& P Department, Government of Gujarat.6.15. We note that the petitioners have approached the GEDA in September 2010 to grant inprinciple approval for setting up Solar Power Project for captive use under REC mechanism.GEDA raised certain queries which were replied by the petitioner on 16.01.2013 alongwithnecessary documents. On query of GEDA that the petitioner has not submitted theapplication for accreditation and registration of the project under REC mechanism online,

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the petitioner submitted that the same was filed on 25.08.2014. However, there is noevidence on record confirming that GEDA has registered and accreditated the project of thepetitioners under REC mechanism by forwarding the same to the NLDC. We also note thatthe GEDA remained silent about the submissions of the petitioner though the petitionerduring the period from 07.09.2012 to 04.08.2014 requested GEDA to register andaccreditate the project under REC plus captive use mechanism. Thus, GEDA failed toperform the duty cast upon it to promote the renewable energy based generation.6.16. During the hearing, the representative of GEDA admitted that GEDA will grant the approvalonce the approval for drawing of the project and approval for energization of the project isgiven by CEI and connectivity is granted by MGVCL, within 7 days. We, therefore, directGEDA to adhere the time lines committed by it during the hearing and carry out thecommissioning activities and issue the certificate of commissioning based on thecommissioning test as carried out by GEDA, within 7 days from the date of connectivitygranted by MGVCL and confirm the compliance by the next date of hearing.6.17. During the hearing, learned senior advocate Shri Saurabh Soparkar, on behalf of thepetitioner, submitted that the petitioner is at present not pressing for compensation for losssuffered by the petitioners due to not allowing the connectivity for the project, not allowingcommissioning of the project, injecting the electricity into the grid for self-consumption andobtain RECs for the same and trade the same in energy market to earn the revenue with aliberty to approach the Commission on the above issues later on. We grant the same.6.18. Based on the above, we summarise as under:

(i) CEI shall approve the drawings of plant and grant the permission of energization within7 days from the date of order;

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(ii) MGVCL shall grant connectivity and execute transmission/wheeling agreement within 7days from approval by CEI;(iii)GEDA shall grant the permission for accreditation and registration of the project underREC mechanism plus captive use as stated by the petitioner within 6 days from signingof transmission/wheeling agreement and grant of connectivity.The above timelines are stipulated as agreed by the respondents during the hearing as pertheir admission.

7) Before parting from the order, we decide that the respondents during the hearing agreed toapprove the electrical drawing, energization of the project, grant connectivity and sign thewheeling/transmission agreement, register and accreditate the project under REC pluscaptive use mechanism and also commissioning of the project. We observe that in thepresent case, the respondents who are the government agencies/companies/authoritiesfailed to perform the duty cast upon them jointly and severally due to which the Solar PVPower Project set up by the petitioners got delayed for more than 10 months and the hugeamount invested by the petitioners remained idle. They were deprived of RECs which mightbe available for energy injected into the grid and also to consume the captive generationfrom the petitioner’ plants. We direct the respondents to adhere to the provisions of the Act,rules and regulations framed under it, otherwise, the actions may be initiated against theconcerned persons for violation of the provisions of Act, rules and regulations framed underit.8) Based on the above observations, we direct the respondents to comply the directives givenby the Commission in para 6 of this order scrupously without failure and intimate thecompliance to the Commission on next date of hearing, which is kept on 21.02.2015 at

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11:30 A.M. We also grant liberty to the petitioner to approach the Commission forcompensation claim, if any.9) The next date of hearing will be on 21.02.2015 at 11:30 A.M.10) We order accordingly.

Sd/- Sd/-

SHRI K. M. SHRINGARPURE SHRI PRAVINBHAI PATEL

MEMBER CHAIRMAN

Place: Gandhinagar.Date: 13/02/2015.