Before the

MAHARASHTRA ELECTRICITY REGULATORY COMMISSION

World Trade Centre, Centre No.1, 13th Floor, Cuffe Parade, Mumbai 400005.
Tel. 022 22163964/65/69 Fax 22163976
Email: mercindia@merc.gov.in
Website: www.merc.gov.in

Case No. 94 of 2021

Case of Nidar Utilities Panvel LLP for approval of Power Purchase Agreement and
Adoption of Tariff determined through transparent bidding process for a Short-Term
procurement of power up to 2.60 MW Round the clock for 9 months starting from 1
October, 2021 to 30 June, 2022

Nidar Utilities Panvel LLP : - Petitioner

GMR Energy Trading Ltd : - Respondent

Appearance: -

For Petitioner: - ....... Shri Jitendra Bhanushali (Rep.)

For Respondent: - …… Shri. Vijay Uniyal (Rep.)

Coram
Sanjay Kumar, Chairperson
I.M.Bohari, Member
Mukesh Khullar, Member

ORDER

Date: 7 September, 2021

1. M/s Nidar Utilities Panvel LLP (NUPLLP) has filed the Petition on 2 August, 2021
under Section 86(1) (b) read with Section 63 of the Electricity Act, 2003 (EA) seeking
approval of Power Purchase Agreement (PPA) and Adoption of Tariff determined
through transparent bidding process for a Short-Term procurement of up to 2.6MW
Round the Clock (RTC) power for 9 months starting from 1 October, 2021 to 30 June,
2022.

2. NUPLLP’s main prayers are as under:

a) Adopt the tariff of Rs. 3.590/kWh at the Maharashtra State (STU) Periphery for the
Short-Term procurement of power upto 2.60 MW (as per the required quantum

MERC Order in Case No. 94 of 2021 Page 1 of 9

 mentioned in Table 1 above) for a period of 9 months starting from 1 October 2021
to 30 June 2022, which is discovered through the competitive bidding u/s 63 of the
Electricity Act, 2003.

b) Approve the Short-Term PPA signed between Nidar Utilities Panvel LLP and
M/s GMR Energy Trading Ltd. for the quantum mentioned in Table No.1 above for
a period of 9 months starting from 1 October 2021 to 30 June 2022 at the Tariff of
Rs. 3.590/kWh.

c) Allow NUPLLP to initiate the process of Short-Term power procurement u/s 63 of

the Electricity Act 2003 for the additional quantum, if required, which is over and
above the quantum mentioned in Table No.1 for which NUPLLP will approach the
Hon’ble Commission for adoption of tariff and approval of the PPA.

3. NUPLLP in its Petition has stated as follows:

3.1 The Commission vide its Order in Case No. 128 of 2016 dated 10 February, 2017 has
taken on record the Deemed Distribution Licensee status of NUPLLP and subsequently
notified the Specific Conditions of Licence for NUPLLP on 25 May, 2017. NUPLLP
commenced its operations as a Distribution Licensee with effect from 1 October, 2018.

3.2 The Commission vide its Order in Case No. 117 of 2017 dated 3 August, 2018 had
approved the Medium-Term Power Purchase Agreement (PPA) between NUPLLP and
Tata Power Distribution Company (TPC-D) for the period of 3 years where the
maximum quantum approved was 7.50 MW for the off-peak and 15 MW for the peak
period starting from 1 October, 2018 to 30 September, 2021.

3.3 The present load is very less as compared to the load approved by the Commission in
Case No. 117 of 2017, where the growth rate and the trajectory of growth will be very
sensitive to addition of each consumer in the system. Since the IT&ITES and Real Estate
Sector is facing the tailwinds due to continuing effect of Covid-19 pandemic, the
projection to the extent of occupancy of the SEZ and the power requirements will depend
on the potential occupiers of the SEZ area in the near future. Further, primarily due to
the Covid 19 outbreak, the projected load growth as submitted and approved by the
Commission in above referred Order is not yet achieved.

3.4 The present RTC load of NUPLLP is to the tune of 1.85 MW and is expected to increase
to around 2.60 MW by March 2022. In addition to this, some of the consumers including
an HT consumer whose consumption is 90% of the present load, intend to expand their
operations in a significant manner. However, clarity on the expected load increase for
the upcoming months and the long-term projections for the ensuing years will only be
available by the end of this year i.e. December 2021 expecting that the effect of Covid-
19 may get minimised. The Commission vide letter dated 24 December, 2020 had
allowed NUPLLP to submit its MYT Petition before 31 December, 2021. Hence, the

MERC Order in Case No. 94 of 2021 Page 2 of 9

 Power Procurement Plan will be submitted as part of MYT Petition, within the stipulated
timelines.

3.5 Considering the fact that current PPA with TPC-D is expiring on 30 September, 2021
and there is uncertainty on the HT Load growth, as an interim measure, NUPLLP has
decided to explore the Short-Term power procurement under Section 63 of the EA, 2003,
in line with the Competitive Bidding Guidelines issued by Ministry of Power (MoP)
Government of India (GoI) dated 30 March, 2016. NUPLLP vide its letter dated 17
May, 2021 had intimated the same to the Commission.

3.6 NUPLLP floated a Request for Proposal (RfP) for procurement of the power under
Short-Term arrangement up to 2.60 MW at the Maharashtra State Periphery on RTC
basis for a period of 9 months i.e. from 1 October, 2021 to 30 June, 2022, in accordance
with Standard Bidding Guidelines on 1 July, 2021 without any deviations. The details
are as below:

Minimum Bid
Period Slot Time Delivery Point
Quantum in MW
01-10-2021 to 30-11-2021 2.20
01-12-2021 to 28-02-2022 2.30 Maharashtra STU
01-03-2022 to 30-04-2022 RTC 2.45 Periphery
01-05-2022 to 30-06-2022 2.60

3.7 NUPLLP issued the Public Notice in the two Newspapers viz. The Indian Express (Delhi
Edition) and Business Standard (Mumbai Edition) on 1 July, 2021. Two Corrigendum
were issued.

3.8 In response, four bids were received. These bids were technically evaluated by the
Tender Evaluation Committee (TEC), which included one external member as per the
Standard Bidding Guidelines and after examining the bid documents, the TEC
technically qualified the bids. The necessary recommendation was forwarded to PFCCL
for opening the price bids and conducting the e-RA.

3.9 On 19 July, 2021 the Financial/Price Bids of all the 4 technically qualified Bidders were
opened. Initial Price Offer (IPO) quoted by the four Bidders is provided as under:

Sr. Bid submitted online on Source of Power Initial Price

No. MSTC website Quoted
(Rs./kWh)
1. Kreate Energy (India) Pvt. Ltd. Power Dept. Govt. of Sikkim 3.99
2. Manikaran Power Limited Sai Wardha Power Generation Ltd. 4.27
3. GMR Energy Trading Ltd. M/s Birla Carbon India Pvt. Ltd. 3.60
Arunachal Pradesh Power Generator located in NR Region
4. Corporation Pvt. Ltd. Energy - (M/s Magpie Hydel Construction 4.40
Inter-State Operation Industries Pvt. Ltd.)

MERC Order in Case No. 94 of 2021 Page 3 of 9

3.10 While activating the e- Reverse Auction (e-RA), as per provision of Guidelines, as total
offered quantity is more than twice the requisition quantity, PFCCL eliminated the H1
Bidder (Arunachal Pradesh Power Corporation Pvt. Ltd.). Thus, only 3 Bidders i.e. M/s
Kreate Energy (India) Pvt. Ltd., M/s Manikaran Power Limited and M/s GMR Energy
Trading Ltd. were qualified to participate in the e-RA event.

3.11 The e-RA session was conducted on 19 July, 2021 from 13:30 hrs, and the final price
bids were discovered as below:

Kreate Energy Manikaran Power GMR Energy

(India) Pvt. Ltd. - Limited - Sai Trading Ltd. - M/s
Particulars
Power Dept. Govt. of Wardha Power Birla Carbon India
Sikkim Generation Ltd. Pvt. Ltd.
Bid Quantity (MW)* 2.60 2.60 2.60
Bid Price (Rs/kWh)
– Maharashtra STU 3.99 4.27 3.59
Periphery

3.12 M/s GMR Energy Trading Ltd. (GMR ETL) (Source – M/s Birla Carbon India Pvt.
Ltd.) was identified as the ‘L1’ Bidder with a price of Rs. 3.59/kWh and emerged as a
Successful Bidder.

3.13 Price discovered for NUPLLP through this competitive bidding exercise is the lowest
since the commencement of the Distribution Business operations and is in tandem with
the present market trends. Thus, Tender Evaluation Committee recommended for
issuance of the Letter of Award (LoA) to GMR ETL

3.14 On 22 July, 2021, NUPLLP issued the LoA to GMR ETL. GMR ETL conveyed its
unconditional acceptance of the LoA on 26 July, 2021. Subsequently, NUPLLP and
GMR ETL executed the PPA dated 29 July, 2021 for supply of power up to 2.60 MW
as per month wise quantum provided at the price of Rs. 3.59/kWh at the Maharashtra
State (STU) Periphery for the period from 1 October, 2021 to 30 June, 2022.

3.15 The required quantum and its corresponding PPA Tariff details are provided as under:
Particulars Period Slot Quantum Price for Total Delivery
Time in MW Quantum (Rs/ Point
kWh)
GMR 01-10-2021 to 30-11-2021 2.20
Energy 01-12-2021 to 28-02-2022 2.30 Maharashtra
Trading Ltd 01-03-2022 to 30-04-2022 RTC 2.45 3.590 STU
Periphery
01-05-2022 to 30-06-2022 2.60

3.16 Clause 11 of the Short-Term Bidding Guidelines mandates the Procurer to file the
Petition for adoption of Tariff before the Appropriate Commission within 2 days of the

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 signing of the PPA. Accordingly, after signing PPA with GMR ETL, NUPLLP filed the
Petition before the Commission on 2 August, 2021.

3.17 The quantum of power procured by NUPLLP is lower than the quantum of power
purchase approved by the Commission in its Order in Case No. 117 of 2017, dated
3 August, 2018. The Tariff discovered through this competitive bidding, i.e., Rs.
3.59/kWh, is much lower than the existing PPA rate of TPC-D’s Unit 8, which was
approved under Section 62 of EA, 2003 by the Commission in the referred Order in Case
No. 117 of 2017.

3.18 Therefore, it is requested that the Tariff discovered through the competitive bidding may
be adopted and approval is accorded to the PPA signed between NUPLLP and GMR
ETL for the Short-Term procurement of power up to 2.60 MW for a period starting from
1 October, 2021 to 30 June, 2022.

3.19 It is further requested that, since there is no clarity on the projected load, there might be
a case where within the Contract Period (1 October, 2021 to 30 June, 2022) the
requirement of power is more than the present requirement of 2.6 MW. In such case
NUPLLP will initiate process of Short-Term power procurement under Section 63 of
EA, 2003 for the additional quantum and will approach the Commission for adoption of
tariff as per short term competitive bidding guidelines.

4. At the time of E-hearing dated 24 August, 2021, representative from NUPLLP reiterated
the submission mentioned in the Petition. Representative of GMR ETL has supported
Petition of NUPLLP.

Commission’s Analysis and Ruling

5. NUPLLP is deemed Distribution Licensee for SEZ area located at Panvel. Said SEZ is
green field project. The Commission vide Order dated 10 February, 2017 in
Case No. 128 of 2016 has taken on record the Deemed Distribution Licensee status of
NUPLLP and subsequently notified the Specific Conditions of Licence for NUPLLP on
25 May, 2017.

6. NUPLLP has filed this Petition seeking approval for PPA and adoption of Tariff
determined through transparent bidding process for a Short-Term procurement of power
up to 2.6 MW (RTC) for 9 months starting from 1 October, 2021 to 30 June, 2022.

7. The Commission notes that presently NUPLLP has been procuring power from TPC-D
under the medium term PPA signed under Section 62 of EA, 2003 for the period of 3
years starting from 1 October, 2018 to 30 September, 2021. Approved Tariff under this
PPA is Rs. 4.88/kWh, 4.85/kWh and Rs. 4.82/kWh for respective year of 3-year PPA

8. As existing PPA is expiring on 30 September, 2021, NUPLLP has decided to initiate

process of power procurement through Short Term bidding for a quantum up to 2.60

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 MW. The Commission notes that NUPLLP’s existing load is to the tune of 1.85 MW
which is on the lower side as compared to load of 7.5 to 15 MW approved by the
Commission vide Order dated 3 August, 2018 in Case No. 117 of 2017 while approving
medium term PPA with TPC. NUPLLP has cited reason of COVID-19 conditions for
such lower demand. However, in present Petition, NUPLLP has projected that its current
load of 1.85 MW will increase up to 2.60 MW by May 2022. In this regard, the
Commission notes that NUPLLP being SEZ based Distribution Licensee and having very
limited area of supply, is better placed to project its demand. Hence, the Commission is
considering demand projected by NUPLLP for analysing proposed power procurement.

9. The Commission notes that NUPLLP has sought bids for 2.20 MW to 2.60 MW of power
on RTC basis at different time period starting from 1 September, 2021 (2.20 MW) to 30
June, 2022 (2.60 MW).

10. The Commission observes that NUPLLP published notice in the two Newspapers viz.
The Indian Express (Delhi Edition) and Business Standard (Mumbai Edition) on 1 July,
2021 and floated e-Tender through Discovery of Efficient Electricity Price (DEEP)
Portal as per Standard Bidding Guidelines without any deviation. The Commission
further observes that NUPLLP appointed PFCCL as the Authorised Representative to
conduct the e-bidding as per Guidelines.

11. The Commission notes that 4 bidders have participated and qualified in the bidding
process. However, before initiating e-Reverse Auction process, PFCCL had eliminated
the Highest quoted Bidder (Arunachal Pradesh Power Corporation Pvt. Ltd.) based on
following provision of Guidelines:

“7.9 The elimination of the Bidders shall be done by the following method:

i) After the opening of Initial Price Offers, the system will rank the Bidders
according to their price bids. The Bidder with the highest price bid in IPO
stage will be called the H1 Bidder. The system will then analyze all the
quantities offered by the Bidders in the IPO stage. If the total quoted quantity
is greater than twice the Requisitioned Quantity, the Highest Bidder(H1) will
be eliminated provided that the total quoted quantity after elimination is not
less than or equal to twice the Requisitioned Quantity.

ii) The Elimination process will be done for each of the requisition separately.
One event may have more than one requisition as explained earlier in Para
7.4”

Accordingly, only 3 bidders qualified for e-RA process. Subsequently, in the e-RA
process dated 19 July, 2021; GMR ETL (Inter-State) has emerged as the lowest Bidder
with a tariff rate of Rs 3.59 /kWh.

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12. LoA dated 22 July, 2021 was issued to GMR ETL, which was accepted by it on 26 July
2021. Thereafter, NUPLLP has signed PPA dated 29 July, 2021 with GMR ETL (Inter-
State) for supply of power up to 2.6 MW on RTC basis at tariff rate of Rs. 3.59/kWh.

13. The Commission notes that Clause 11.4 of the standard bidding Guidelines dated 30
March, 2016, stipulates as under:

“11.4. If the quantum of power procured and tariff determined are within the blanket
approval granted by the Appropriate Commission in Annual Revenue Requirement
(ARR) of the respective year, then the same will be considered to have been adopted
by the Appropriate Commission.
In all other cases, the Procurer(s) shall submit a petition to the Appropriate
Commission for adoption of tariff within 2 days from the date of signing of PPA.
Appropriate Commission should communicate the decision within 7 days from the
date of submission of petition.”

The Commission notes that the rate discovered by NUPLLP through competitive bidding
process i.e. Rs. 3.59 /kWh is much lower than existing power procurement rate of Rs.
4.82/kWh. Since there is no approved MYT Tariff Order in respect of NUPLLP
specifying ceiling rate for short term power procurement, it necessitates NUPLLP to
approach the Commission through present Petition for adoption of tariff.

14. On the issue of rate discovered through competitive bidding, the Commission notes that
in recent past it has adopted following Short Term power procurement rates for various
SEZ based Distribution Licensees:

Approved
Sr Adopted Rate
Particulars Quantum
No (Rs/ kWh)
(MW)
Eon Kharadi Infrastructure Private Rs 3.97/ kWh
7 & 3 MW
1 Limited Phase I and Phase II (Case No at periphery of
(RTC)
171 and 172 of 2020) Distribution Licensee
Laxmipati Balaji Supply Chain Rs 4.48 / kWh
1MW
2 Management Limited (Case No 211 of at periphery of
(RTC)
2020) Distribution Licensee
Rs 3.60 / kWh
Jawaharlal Nehru Port Trust (Case No 2MW
3 at periphery of
5 of 2021) (RTC)
Distribution Licensee
KRC DISCOMs (Mindspace Business
5 MW; 4.5
Parks Private Limited; Gigaplex Estate Rs 3.18 / kWh
MW and 3
4 Private Limited; KRC Infrastructure at periphery of
MW
and Projects Private Limited) (Case No Maharashtra STU
(RTC)
69 of 2021)

In view of above, and considering quantum of 2.20 MW to 2.60 MW, the Commission is of
the opinion that rate discovered by NUPLLP i.e. Rs 3.59/ kWh at Maharashtra State

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 Periphery is reflective of current market rate. Further this discovered rate of Rs 3.59/ kWh
is lower than the existing contract with TPC i.e Rs 4.82 / kWh.

15. Section 63 of the EA, 2003 mandates the Commission to adopt the tariff if such tariff has
been determined through transparent process of bidding in accordance with the
guidelines issued by the Central Government and if such rate is reflective of market rates.

16. In view of the foregoing, the Commission rules that Power Procurement rate discovered
by NUPLLP fulfils mandates and requirements for adoption as set out in Section 63 of
the EA, 2003. Accordingly, the Commission adopts following Power Procurement rate
for the period of 9 months from 1 October, 2021 to 30 June, 2022.
Seller Period Slot Quantum Price (Rs/ Delivery
Time (MW) kWh) Point
GMR 01-10-2021 to 30-11-2021 2.20
Energy 01-12-2021 to 28-02-2022 2.30 Maharashtra
Trading 01-03-2022 to 30-04-2022 RTC 2.45 3.590 STU
Ltd Periphery
01-05-2022 to 30-06-2022 2.60

17. The Commission also notes that PPA initialed with GMR ETL is in line with Standard
Bidding documents issued by the MoP. Accordingly, the Commission approves PPA
initialed with GMR ETL at the rate and for the quantum mentioned in above tables in
para 16. NUPLLP shall submit copies of final PPA for records of the Commission.

18. NUPLLP has requested the Commission to allow undertaking additional short term
power procurement if power demand exceeds the contracted quantum. In this regard, the
Commission notes that as a Distribution Licensee, NUPLLP is mandated to fulfil
electricity demand of its consumers. Hence, in case its demand increases beyond the
contracted capacity, it is free to procure such additional power through fresh short term
bidding process or through power exchanges and may approach the Commission for adoption
of tariff, if required as per law.

19. The Commission also notes that it has already allowed NUPLLP to file its first MYT Petition
by 31 December 2021 and in the present Petition NUPLLP has assured to file the same within
due date. While filing such Petition, NUPLLP shall ensure that it undertakes detailed demand
projection for remaining period of Control Period and proposed suitable power procurement
strategy for keeping power procurement rate at least possible level.

20. Hence following Order.

ORDER

1. Case No 94 of 2021 is allowed.

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2. Under Section 63 of the Electricity Act, 2003, the Commission adopts Short Term
Power Procurement for the period of 1 October, 2021 to 30 June, 2022 by Nidar
Utilities Panvel LLP as stated in para 16 above.

3. Accordingly, the Commission approves PPA dated 29 July, 2021 entered between
Nidar Utilities Panvel LLP and GMR Energy Trading Ltd. Copy of Final PPA be
submitted for records of the Commission.

4. The Commission allows Nidar Utilities Panvel LLP to undertake additional short
term power procurement if the requirement of power exceeds the contracted capacity.

Sd/- Sd/- Sd/-

(Mukesh Khullar) (I.M. Bohari) (Sanjay Kumar)
Member Member Chairperson

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