Before the

MAHARASHTRA ELECTRICITY REGULATORY COMMISSION

Centre No.1, 13^th floor, World Trade Centre, Cuffe Parade, Mumbai 400 005.

Phone 2216 39 64, 2216 39 65, 2216 39 65, FAX 2216 39 76

Case No. 24 of 2002

In the matter of review of Order dated 16^th August 2002 for purchase of power

from bagasse based, etc., co-generation projects.

Shri P. Subrahmanyam, Chairman

Shri Jayant Deo, Member

Dr Pramod Deo, Member

I N T E R I M O R D E R

Dated – 10^th September, 2003

In its Order dated 16^th August 2002 in the matter of purchase of power from bagasse and other non-fossil fuel based co-generation (excluding any incidental co-generation) projects, the Commission has prescribed the qualifying criteria for such projects to be eligible for the approved energy purchase rate, and also directed that any new Energy Purchase Agreement (EPA) shall be governed by the principles set out in Section 4 of the Order. The Commission also directed MSEB “to submit the half-yearly progress report on the capacity addition, purchase of energy and other relevant details in respect of non-fossil fuel based co-generation projects to the Commission and also directs to post the same on their website.”

2. Accordingly, the Commission has, from time to time, received various communications in compliance, including (i) MSEB letter No. CP/MERC/Purti SSKL/882 dated 21.09.2002, (ii) MSEB letter No. CP/MERC/524 dated 28.5.2003 furnishing details of approval accorded to 13 new projects aggregating 189.50 MW, (iii) MSEB affidavit dated 13.6.2003 confirming meeting of qualifying criteria by M/s Pravara Power Private Ltd in Case No.18 of 2001, (iv) various submissions in Case No. 22 of 2002 pertaining to M/s Rajarambapu Patil SSK Limited, and (iv) MSEB letter No. CP/MERC/830 dated 6^th August 2003 seeking clarification in the matter of EPAs with M/s Shri Vighnahar SSK Ltd. and M/s Shri Pandurang SSK Ltd.

3. In some of the above cases, the Commission has observed ambiguity, deficiencies and/or lack of uniformity on the part of MSEB and/or the developers in interpreting and computing the qualifying criteria to be met as stipulated in the Order dated 16.8.2002. At the same time, the Commission is seized with the Review Petition submitted by Shri S.R. Paranjpe, in the present Case No.24 of 2002, which has been admitted and is being heard further. Under Order dated 16.8.2002, “for the co-generation facility to qualify under topping cycle mode, the sum of useful power output and one-half the useful thermal output be greater than 45% of the facility’s energy consumption, during season.” The Review Petition seeks, inter alia, that the terms `useful thermal output’ and `useful power output’ be clarified and defined to remove any ambiguity in computation for the purpose of evaluating whether or not a project meets the qualifying criterion. In view of the differing interpretation of these terms observed by it, the Commission intends to clarify the position in the course of the proceedings in Case No.24 of 2002 filed by Shri Paranjpe in order to remove any scope for ambiguity.

4. In the meantime, so as to ensure that the purpose of stipulating qualifying criteria in the Order dated 16.8.2002 is not defeated or diluted, MSEB are hereby directed not to take any further action with regard to EPAs subsequent to the Commission’s Order dated 16.8.2002, except for the specific projects mentioned in that Order until further directions from the Commission.