Assam’s 750 MW solar project withdrawal renders transmission scheme infructuous
The Central Electricity Regulatory Commission (CERC) has disposed of the transmission licence petition for the North Eastern Region Generation Scheme-I (NERGS-I) after the withdrawal of the associated 750 MW solar project proposed by Assam Power Distribution Company Limited (APDCL), holding that the transmission scheme had become infructuous.
In its order dated July 15, 2026, the Commission declined to examine compensation claims raised by Techno Electric & Engineering Company Limited, stating that issues relating to cost recovery cannot be adjudicated in proceedings initiated solely for the grant of a transmission licence.
Background
NERGS-I was awarded to Techno Electric & Engineering Company Limited through the tariff-based competitive bidding (TBCB) route at a transmission charge of Rs 303.68 million. The scheme was planned as the dedicated transmission system for APDCL’s proposed 750 MW solar project at Bokajan in Assam.
However, the generation project was subsequently withdrawn after the Government of India decided to withdraw the proposal for funding through the Asian Development Bank (ADB). The withdrawal followed a request from the Government of Assam, which cited law and order concerns in Karbi Anglong district.
The Commission observed that, in the absence of the generation project, implementation of the transmission system would result in stranded assets and an inefficient use of transmission infrastructure.
Compensation claims
Techno Electric & Engineering Company Limited sought compensation of around Rs 28.5 crore towards actual expenditure incurred on the project, in addition to Rs 40.84 crore claimed as loss of opportunity.
CERC declined to consider these claims in the present proceedings and relied on a recent judgment of the Appellate Tribunal for Electricity (APTEL), which held that recovery of project costs should not be permitted in tariff adoption and licence proceedings that have become infructuous.
The Commission, however, granted liberty to the company to file a separate petition for compensation, noting that all parties would be free to rely on their pleadings and submissions made during the current proceedings.
Stakeholder positions
APDCL had furnished a connectivity bank guarantee of Rs 214 crore to Central Transmission Utility of India Limited (CTUIL). The utility has offered to reimburse Rs 5.12 crore towards actual and verifiable expenditure incurred by the transmission developer, while contesting the balance claims.
CTUIL, which executed the Transmission Service Agreement (TSA) with Techno Electric & Engineering Company Limited, opposed withdrawal of the licence petition. It argued that the transmission developer remained contractually obligated to pursue the licence and that withdrawal of the petition could trigger liquidated damages under the TSA.
The Commission directed the parties to take necessary steps for termination of the TSA in accordance with its contractual provisions.
Regulatory implications
The order highlights an unresolved regulatory issue concerning stranded transmission projects developed under the TBCB framework. While CERC has closed the licence proceedings, the question of how transmission developers recover costs when linked generation projects are abandoned due to sovereign or policy decisions remains open.
The Commission’s order effectively separates the issue of transmission licensing from compensation claims, leaving the latter to be decided through independent proceedings, if pursued by the developer.
The featured photograph is for representation only.
