Home >Companies >News >Maharashtra discom told to pay Rs2,300 cr to Ratnagiri Gas
Ratnagiri Gas is demanding payment of fixed charges from June 2013 to March 2015. Photo: Hindustan Times
Ratnagiri Gas is demanding payment of fixed charges from June 2013 to March 2015. Photo: Hindustan Times

Maharashtra discom told to pay Rs2,300 cr to Ratnagiri Gas

Appellate tribunal also dismisses Mahavitaran's appeal against a Central Electricity Regulatory Commission order

The Appellate Tribunal for Electricity (Aptel) on Thursday asked Maharashtra power distribution company Mahavitaran Ltd to pay 2,300 crore as fixed charges to the troubled Ratnagiri Gas and Power Pvt. Ltd (RGPPL), which owns a 1,960 megawatts (MW) gas-based power plant at Dabhol.

Aptel also dismissed the distribution company’s (discom’s) appeal against a Central Electricity Regulatory Commission order. RGPPL is demanding payment of fixed charges from June 2013 to March 2015.

Power tariff consists of two components—fixed costs such as the cost of machinery, debt servicing and salaries, and variable cost, which is mainly the cost of fuel.

“We will be soon be challenging the Aptel’s order before the supreme court," said a spokesman for Mahavitaran.

RGPPL was allocated 7.6 metric million standard cu. m per day (mmscmd) of gas from Reliance Industries Ltd’s KG-D6 gas field in 2008.

Gas supply started dwindling starting September 2011, which forced RGPPL to enter an agreement with GAIL (India) Ltd for alternative supply of regassified liquid natural gas (R-LNG) through imports.

Mahavitaran was not ready to buy power produced from R-LNG, claiming that the cost of the power was higher than anticipated.

RGPPL then demanded a payment of the fixed costs, stating that though it is ready to supply power using R-LNG, Mahavitaran is reluctant to buy it.

Mahavitaran has refused to pay the fixed costs, claiming that the power purchase agreement with RGPPL states that it must get a clearance from the discom before entering into any gas purchase agreement, which it had failed to get.

“PPA between RGPPL and Mahavitaran, LNG, R-LNG and natural gas all are primary fuels and hence Mahavitaran is liable to pay fixed charges to RGPPL, hence we are dismissing the appeal by Mahavitaran," stated the APTEL order.

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