Adani Mundra tariff order fuels hope for Indonesian coal users - Financial Express

In a regulatory ruling which would remove the uncertainty over a host of mega power plants, the Central Electricity Regulatory Commission (CERC) has upheld Adani Power's right to recover additional fuel costs arising from the recent hike in Indonesian coal price from those who buy electricity from its Mundra project. The ruling would mean that discoms in Haryana and Gujarat that buy power from the plant might have to pay almost R1 more for each unit of power from the plant. Together, these discoms must shell out an additional R1,200 crore per annum if the CERC order is implemented and the tariffs so revised. Of course, the extra cost will ultimately be passed on to the retail consumers in these states, given that the policy of pass-through of cost is being implemented in the sector with renewed vigour. The CERC did not spell out any formula for tariff revision, saying the quantum of extra fuel cost will be decided by the parties concerned through mutual consent. A panel comprising the company, principal secretaries (power) in the two states and chiefs of discoms concerned will assess the impact of the higher coal price on the viability of the project and decide the quantum of additional tariff. Tata Power's ultra-mega power plant (UMPP) at Mundra and Reliance Power's Krishnapatnam UMPP are likely to benefit from Tuesday's CERC decision as their pleas for tariff revision on similar grounds are pending with the regulator and the ruling in the Adani Power case could set a precedent. ... contd. via Business - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNEbqVXU1B2Xe1mj-YHygXgauJmS2A&url=http://www.financialexpress.com/news/adani-mundra-tariff-order-fuels-hope-for-indonesian-coal-users/1097386

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