NATIONAL THERMAL POWER CORPORATION LTD Vs. MADHYA PRADESH STATE ELECTRICITY BOARD
LAWS(ET)-2006-2-9
CENTRAL ELECTRICITY REGULATORY COMMISSION
Decided on February 16,2006

Appellant
VERSUS
Respondents

JUDGEMENT

- (1.) THE petitioner, in this petition has prayed for relaxation of target availability norm in case of Kawas Gas Power Station (Kawas GPS) and Gandhar Gas Power Station (Gandhar GPS) for the period 1.4.2004 to 31.3.2009. Both these generating stations supply power to the beneficiaries in the Western Region.
(2.) Kawas GPS was declared under commercial operation during 1992-93 with natural gas fuel linkage of 2.25 MMSCMD from HBJ pipeline for base load operation at 62.78% PLF, the norm applicable at the relevant time for recovery of full capacity (fixed) charges. The generating station was however, supplied gas up to a maximum of 2.01 MMSCMD. Similarly, Gandhar GPS was conceived, designed and declared under commercial operation during 1995 with natural gas as fuel, approved as a base load power station with the firm allocation of 1.5 MMSCMD from Gandhar fields and an assurance to increase the allocation of gas to 2.25 MMSCMD in due course of time. However, the supply position deteriorated as regards Gandhar GPS and it was reduced to 0.38 MMSCMD in physical terms. Liquid fuel firing facility was commissioned at Kawas GPS in June-July 1997 after the beneficiaries agreed to avail power generated by using liquid fuel, that is, Naphtha. Because of the prohibitive cost associated with renovation, liquid fuel firing facility could not be commissioned at Gandhar GPS. Therefore, in its 107th meeting held on 18.4.1998 at WREB, the beneficiaries consented to link Kawas GPS and Gandhar GPS with 85 Km long pipeline to enable optimum utilization of the two generating stations by diverting gas from Kawas GPS to Gandhar GPS and operate Kawas GPS on liquid fuel as this facility was available there. Subsequently, however, the proposal was modified and Gandhar GPS was connected with HBJ pipeline through a spur pipeline of 25 kms as it was more economical. Despite these arrangements, the two generating stations could not achieve the normative target availability for recovery of capacity charges. The petitioner, therefore, had pleaded for the relaxation of target availability in their tariff petition No.31/2001 for Kawas GPS and petition No.33/2001 for Gandhar GPS for the tariff period 2001-2004. While these petitions were pending finalization in the Commission, ABT was implemented in the Western region with effect from 1.7.2002. ABT implementation required that petitioner should declare availability of the station capacity on day ahead basis and therefore, the petitioner had made an application (Petition No.86/2002) for relaxation of target availability level in respect of these two generating stations for the period 1.7.2002 to 31.3.2004. The Commission in its order dated 1.11.2002 in Petition No.86/2002 has held as follows: 16. In order to do even handed justice to both the parties, we direct as under: (a) For the purpose of recovery of capacity charges Kawas GPS and Gandhar GPS shall be considered as single integrated unit. This is basically for the reason that the gas supply to these two stations has been operated in an integrated manner by transferring it from Kawas GPS to Gandhar GPS. (b) Recovery of full capacity charges in respect of Kawas GPS and Gandhar GPS shall be allowed on the "unit" achieving 80% machine availability and 65% PLF, subject to dispatch instructions by WRLDC. The petitioner shall be liable to demonstrate the machine availability when asked to do so by WRLDC/WREB. (c) In case the "unit" is unable to achieve 65% PLF coupled with 80% machine availability, the petitioner shall be liable to pay disincentive on pro-rata basis to the beneficiaries. (d) The petitioner shall not be entitled to incentive even in case the "unit" achieves PLF of more than 77%. (e) Special dispensation being made shall be applicable from 1.7.2002, the date of introduction of ABT in the Western Region and up to 31.3.2004, that is, during the current tariff period. (f) The special dispensation shall be reviewed while considering revision of norms for the period beyond 31.3.2004. (g) The parties shall be at liberty to seek review of these directions in the event of improvement of supply of gas for the "unit". This relaxation was later made applicable with effect from 1.4.2001 for these stations relaxing target availability in the tariff order. The petitioner has stated that despite the best efforts made by it, it was not possible to procure sufficient quantity of gas to enable these generating stations to operate at the normative capacity. It has further stated that the beneficiaries are not requisitioning the power from Kawas GPS generated by using Naphtha, because of the very high cost of generation. Accordingly, the petitioner has sought to be allowed to treat Kawas GPS and Gandhar GPS as single integrated unit for the purpose of recovery of capacity charges on the "unit" achieving 80% machine availability at individual station and 65% combined availability. The prayer is in terms of the order dated 1.11.2002 in Petition No.86/2002.
(3.) THE terms and conditions for determination of tariff for the period 1.4.2004 to 31.3.2009 have been specified by the Commission in terms of the Central Electricity Regulatory Commissions (Terms and Conditions of Tariff) Regulations, 2004 (the regulations). As specified in sub-clause (a) of clause (i) of Regulation 16 of the regulations, in respect of all thermal power generating stations, except those specifically mentioned under sub-clauses (b) and (c) thereof, target availability for recovery of full capacity (fixed) charges is 80%. THEse two generating stations are not exempted in terms of sub-clauses (b) and (c) and thus, the target availability for recovery of full capacity (fixed) charges of 80% applies to Kawas GPS and Gandhar GPS individually. THE petitioner seeks relaxation under proviso to clause (2) of Regulation 2 and also Regulation 13.;


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