Surendra Kumar, J. - (1.) THE Appeal No. 251 of 2013 under Section 111 of the Electricity Act, 2003, has been preferred by Timarpur -Okhla Waste Management Company Limited (in short, the 'Appellant'), challenging only a part of the tariff Order, dated 31.7.2013, passed by the Delhi Electricity Regulatory Commission (in short, the 'State Commission)/Respondent No. 1 herein, in Petition No. 1 of 2013, whereby the State Commission has while conducting the True -up for FY 2011 -12, Review and Provisional True -up for FY 2012 -13 and approving the Annual Revenue Requirement of the Respondent No. 2 (BSES Rajdhani Power Limited)/Distribution Licensee for its Distribution (Wheeling and Retail Supply) business for FY 2013 -14 has allowed the Respondent No. 2 to fulfill part of its Renewable Purchase Obligation (RPO) by purchasing 50 MU power from the Appellant at Rs. 2.60 per unit. The Appellant is the Power Generating Company, Respondent No. 1/DERC is the State Regulatory Commission and Respondent No. 2/BSES Rajdhani Power Ltd. is the Distribution Licensees (hereinafter referred to as 'BRPL').
(2.) THE Appeal No. 325 of 2013 under Section 111 of the Electricity Act, 2003, has been preferred by Timarpur -Okhla Waste Management Company Limited (in short, the 'Appellant'), challenging the Order, dated 18.9.2013, passed by the Central Electricity Regulatory Commission (in short, the 'Central Commission)/Respondent No. 1 herein, in Petition No. 246/MP/2012, whereby the Central Commission relied on the tariff order, dated 31.7.2013, passed by the Delhi Electricity Regulatory Commission regarding 'True -up for FY 2011 -12, Aggregate Revenue Requirement and Distribution Tariff (Wheeling & Retail Supply) for FY 2013 -14', considered the 8 MW power supplied by the Appellant towards fulfillment of Renewable Purchase Obligation (RPO) of the Respondent No. 3 (BSES Rajdhani Power Limited) (hereinafter referred to as 'BRPL') at a price of Rs. 2.60 per unit and, further, directed the Appellant to either take steps for resolution of the dispute regarding the same in accordance with the Dispute Resolution Mechanism provided under Article 22 of the Energy Purchase Agreement (EPA) or to approach the State Commission for a clarification as to whether 8 MW of Energy covered under the EPA with the Respondent No. 3/BRPL qualifies to be considered as meeting the Renewable Purchase Obligation of the said Distribution Licensee. The Appellant is the Power Generating Company, Respondent No. 1 is the Central Electricity Regulatory Commission, Respondent No. 2 is the National Load Dispatch Centre and Respondent No. 3/BSES Rajdhani Power Ltd. is the Distribution Licensee. The main grievances of the Appellant in these Appeals No. 251 of 2013 and 325 of 2013 against the respective impugned orders are: A. No. 251/2013 (a) that the State Commission while passing the tariff order, dated 31.7.2013, failed to appreciate that the issue as to whether the power purchased by the Respondent No. 2 from the Appellant under EPA, dated 22.1.2010, can be treated towards fulfillment of the Renewable Purchase Obligation of the Respondent No. 2 was pending adjudication of Petition No. 23 of 2013 and Petition No. 246 of 2012 before it and before the Central Commission respectively and, therefore, the State Commission ought to have considered the contentions of the Appellant before allowing the said power to be treated towards the Renewable Purchase Obligation of the Respondent No. 2 vide the tariff order, dated 31.7.2013, as the said tariff order may make the aforesaid petitions, being Petition Nos. 23 of 2013 and 246 of 2012, infructuous without any hearing. (b) that the State Commission ought to have granted an opportunity of personal hearing to the Appellant in view of its letter, dated 27.5.2013, before passing the tariff order, dated 31.7.2013, wherein it incorrectly recorded presence of the representative of the Appellant in the personal hearing. The notice for personal hearing on 17.5.2013, was received by the Appellant company only on 22.5.2013 and, therefore, there was no occasion for the Appellant to attend the public hearing. Due to violation of principle of natural justice and also contrary to Section 86(3) of the Electricity Act, 2003, impugned part of the tariff Order, dated 31.7.2013, is liable to be set aside. (c) that the impugned part of the tariff order of the State Commission which allows the power procured from the Appellant at a rate much lower than the average pooled purchase cost of the Respondent No. 2 to be taken into consideration for fulfillment of the Renewable Purchase Obligation of the Respondent No. 2. A. No. 325/2013 (d) that tariff fixed under the EPA was a preferential tariff and the Central Commission has illegally relied on the tariff order of the DERC which allows the power procured from the Appellant at the rate much lower than the average pooled purchase cost of the Respondent No. 3/Distribution Licensee to be taken into consideration for fulfillment of the Renewable Purchase Obligation of the Respondent No. 3 and by the impugned order, the Central Commission has wrongly directed the Appellant to invoke Clause 22 of the EPA or to approach the State Commission for a clarification on the said issue. (e) that the Central Commission erred in not appreciating that Section 86(1)(e) and 61(h) of the Electricity Act, 2003 mandated promotion of electricity and in furtherance of the said provisions, the Central Electricity Regulatory Commission (Terms and Conditions for Tariff Determination from Renewable Energy Sources) Regulations, 2012 were framed introducing the REC Mechanism, which was subsequently amended vide the 2nd amendment regulations, dated 10.7.2013, to include the tariff determined through competitive bidding under Section 63 of the Act under the ambit of preferential tariff. However, the Central Commission failed to appreciate that 2nd Amendment Regulations cannot be applied in a retrospective manner in order to exclude the project of the Appellant from the REC Mechanism, by treating its tariff determined much prior to introduction of the said 2nd REC Amendment Regulations as well as introduction of 1st REC Regulations by DERC as well as Central Commission. (f) that the Central Commission also failed to appreciate that the Energy Purchase Agreement, dated 22.1.2010, executed between the Appellant and the Respondent No. 3/Distribution Licensee did not contemplate treatment of the Power procured by the Respondent No. 3 from the Appellant there -under towards fulfillment of Renewable Purchase Obligation of the Respondent No. 3. Further, M/s Indraprastha Energy and Waste Management Company Limited, a Joint Venture Company of the Government of National Capital Territory of Delhi and IL & FS which initiated and held the bidding process vide letter, dated 19.11.2012, has, inter -alia, clarified the position on the bidding process and the status of the project stating that: "8. It is therefore clarified that as per the RFP, the Okhla Waste to Energy Project was not intended to enable BRPL to discharge Renewable Purchase Obligations." (g) that the Central Commission failed to appreciate that the State Commission, vide its earlier order, dated 29.8.2012, in Petition No,. 31/2012 in the Petition of M/s Delhi MSW Solutions Limited in relation to the Bawana Waste to Energy Plant ('Bawana DERC Order') has held that the project of the Appellant herein was entitled to sell RECs in the market on account of green attributes of its Power Generation. Accordingly, there was no reason for the Central Commission to ignore the same and accept the subsequent order of the State Commission to allow the Power of the Appellant to be treated towards fulfillment of the Renewable Purchase Obligation of the Respondent No. 3. Further, the Central Commission erred to take judicial notice of the order, dated 31.7.2013, passed by the DERC in petition No. 1 of 2013 on its own without holding any hearing on the same and further without granting the Appellant any opportunity of hearing in order to advance its contentions with respect to the said order of the DERC. Such a unilateral reliance placed by the Central Commission on the order, dated 31.7.2013, passed by the State Commission is clearly violative of principle of natural justice and the portion of that impugned order, dated 18.9.2013, is liable to be set aside.
(3.) THE National Electricity Policy and National Tariff Policy also provide for promotion of Renewable energy and for giving them preferential tariff. The project of the Appellant is of much more significant importance as compared to Solar Power Generation or Wind Power Generation. In the case of Solar Projects or Wind Power Projects, there is only a conversion of solar power or wind power without any treatment of waste etc. In the case of Waste to Power Project, it is environmental friendly and provides much needed treatment of Urban/Municipal Waste, which itself, is an important social objective and additionally power is generated. The project of the Appellant is being set up at an old compost plant site converted into Municipal Solid Waste (MSW) dumping site of the Municipality thereby utilizing the dumping site in the most efficient and environment friendly manner. The project activity reduces emission of methane, a powerful contributor to climate change and any leachate that would have been generated. Such project activity directly results into more cleaner and healthy environment thereby reducing the possible health hazards that would emerge from mere dumping of waste and thus lead to improved public health. In view of the nature of the project namely, the project being non -conventional energy development project involving the use of Municipal Solid Waste to generate electricity, it is necessary to encourage the developer with a tariff and by registering the same under the REC Mechanism to provide sufficient additional incentives to induce necessary investment. The technology required for such project is also new and needs to be procured and used at significant cost. The project clearly comes into the provisions of Section 61(1)(h) read with Section 86(1)(e) of the Act and is also a part of the declared policies of the Central Government and State Government and the Central Electricity Regulatory Commission and State Electricity Regulatory Commissions.;