Captive wind power user wins refund battle against MSEDCL over charge calculation method
The Maharashtra Electricity Regulatory Commission (MERC) has directed Maharashtra State Electricity Distribution Company Limited (MSEDCL) to refund excess wheeling and transmission charges collected from Serum Institute of India Pvt. Ltd. (SIIPL) for the period from September 2021 to May 2023, along with applicable interest.
The dispute concerned the methodology used by MSEDCL to calculate wheeling and transmission charges on open access power sourced by SIIPL from its captive wind power plants.
Dispute over charge calculation
SIIPL operates 29 wind turbine generators across Dhule, Sangli and Satara districts. The company argued that MSEDCL had calculated wheeling and transmission charges on the basis of gross energy injection instead of actual energy drawal at the consumption end.
According to SIIPL, this approach was contrary to Regulation 14.6 of the MERC (Distribution Open Access) Regulations, 2016 and the Commission’s Practice Directions issued on March 8, 2017.
SIIPL sought a refund of Rs 68.65 lakh towards excess charges along with interest of Rs 9.10 lakh, taking the total claim to Rs 77.75 lakh.
MSEDCL maintained that its levy was in accordance with the regulatory framework. The utility stated that its reconciliation calculations showed a difference of only Rs 2.99 in wheeling charges and Rs 0.82 in transmission charges for the entire period, which it attributed to rounding.
Commission observations
The Commission noted that MSEDCL had challenged similar orders before the Appellate Tribunal for Electricity (APTEL) while also filing delayed submissions in the present matter. MERC described this approach as “entirely unacceptable”.
The Commission further observed that MSEDCL had not submitted the detailed bill calculation sheets that it had referred to during the proceedings.
Earlier rulings cited
Referring to its decisions in cases involving AMJ Land Holdings, Kore, Imagicaa, Persistent Systems, ICC Reality, Pragati Agencies and Sahyadri Industries, MERC reiterated that wheeling and transmission charges should be levied on actual energy drawal at the consumption end, namely the units adjusted against open access power, and not on gross energy injection.
The Commission also rejected MSEDCL’s contention that wheeling losses had been excluded from approved wheeling charges in the Multi Year Tariff (MYT) Order dated November 3, 2016. It stated that any issue regarding the computation of wheeling losses should have been raised during the MYT proceedings.
Refund within one month
While directing MSEDCL to process the refund, the Commission declined to initiate proceedings under Section 142 of the Electricity Act, 2003. MERC noted that MSEDCL had been implementing the applicable methodology for levy of transmission and wheeling charges since June 2023.
The Commission also reiterated its earlier direction requiring MSEDCL to take appropriate steps to provide refunds to all similarly placed open access consumers, in line with the APTEL judgment dated October 6, 2022 and subsequent Commission orders.
MSEDCL has been directed to process the refund within one month from the date of the order, subject to verification of SIIPL’s claims.
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