Regulatory Commission Grants Final Extension for 300 MW Gadag Renewable Energy Project Amid Ongoing Compliance Struggles

Posted On - 30 May, 2024 • By - King Stubb & Kasiva

Summary:

The Central Electricity Regulatory Commission (CERC) granted SolarOne Energy Private Limited (SEPL) a final extension until May 27, 2024, to submit the required land documents for their 300 MW renewable energy project in Gadag, Karnataka.[1] This decision follows SEPL’s repeated failure to meet previous deadlines, first for submitting a bank guarantee and then for land documents. CERC expressed strong displeasure over SEPL’s conduct but granted the extension considering the project’s advancement and the importance of renewable energy development. However, CERC imposed a cost of ₹10,000 on SEPL and warned of connectivity revocation if the deadline is not met.

Case Timeline:

  • April 21, 2024: CERC issued an order in Petition Nos. 291/MP/2023 and 292/MP/2023, directing SEPL to comply with certain conditions, including submitting land documents or a bank guarantee.
  • May 1, 2024: SEPL filed an application seeking clarification and an extension for compliance.
  • May 4, 2024: CERC granted a one-time extension until May 20, 2024, for SEPL to submit a bank guarantee.
  • May 17, 2024: SEPL filed a compliance affidavit, requesting another extension as they could not obtain the necessary board approval for the bank guarantee but had made significant progress with land documents.
  • May 19, 2024: CERC heard the matter and granted a final extension until May 27, 2024, for submitting land documents.

Issues Raised:

Whether to grant yet another extension to SEPL, considering the project’s advancement and the importance of renewable energy development, while also upholding the integrity of the regulatory process and ensuring fair treatment to all stakeholders.

Petitioner’s Arguments

SEPL argued that they had been unable to secure the required board approval for submitting the bank guarantee by the May 20th deadline. However, they emphasized substantial progress in acquiring the necessary land documents, with 227.07 acres already registered and an additional 29 acres pending registration. They attributed the delay in finalizing the remaining 55.93 acres to administrative hurdles and requested a short extension to complete the process.

Respondent’s Arguments

CTUIL, on the other hand, expressed their discontent with SEPL’s repeated requests for extensions, emphasizing that the regulatory commission had already shown leniency. They stressed the need for regulatory compliance and requested adequate time to review SEPL’s compliance affidavit and supporting documents.

Order:

After careful consideration of both parties’ arguments, CERC granted SEPL a final extension until May 27, 2024, to submit all required land documents. While acknowledging SEPL’s progress, the commission expressed strong disapproval of the repeated delays and imposed a cost of ₹10,000 on the company. CERC also issued a stern warning that failure to meet this final deadline would result in the revocation of SEPL’s connectivity for the Gadag project.

Analysis:

This case highlights the delicate balance between regulatory compliance and the urgency of developing renewable energy projects. CERC’s decision demonstrates a pragmatic approach, acknowledging SEPL’s progress while emphasizing the importance of adhering to regulatory timelines. The imposed cost and final warning serve as a reminder of the consequences of non-compliance and the need for developers to prioritize adherence to regulatory requirements while pursuing their project goals.

[1] https://cercind.gov.in/2024/orders/257.pdf