Omnicore Weekly #244 - 30 January 2026

Dear Patrons & Readers, 

Approval under Section 62 read with Section 79 (1)(d) of the Electricity Act, 2003 and under Regulation 15 (1)(a) and Regulation 23 of the Central Electricity Regulatory Commission (Conduct of Business) Regulations, 2023 for the truing up of Transmission Tariff for 2019-24 tariff period and determination of Transmission Tariff for 2024-29 tariff period for the Combined Asset under “System Strengthening in Southern Region – XIV” in Southern Region.

Power Grid Corporation of India Limited,

Versus

Tamil Nadu Generation and Distribution Corporation Limited, Kerala State Electricity Board Limited, & 12 Others

Background:

The instant Petition has been filed by Power Grid Corporation of India Limited (hereinafter referred to as ‘PGCIL’/ ‘the Petitioner’) for truing-up of the transmission tariff for the 2019-24 tariff period, under the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019 (hereinafter referred to as “the 2019 Tariff Regulations”) and for the determination of transmission tariff for the 2024-29 tariff period, in terms of the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2024 (hereinafter referred to as “the 2024 Tariff Regulations”), for the following assets in the Southern Region (hereinafter referred to as the “transmission assets/Combined Asset”).

2. The Petitioner has made the following prayers in the instant Petition:

a) “Approve the trued-up Transmission Tariff for 2019-24 block and transmission tariff for 2024- 29 block for the assets covered under this petition, as per para 14 and 15 above.

b) Admit the capital cost claimed, and additional capitalization incurred during 2019-24 (Arbitral award) and also allow the projected additional capitalization during 2024-29.

c) Allow the petitioner to recover the shortfall or refund the excess Annual Fixed Charges, on account of Return on Equity due to change in applicable Minimum Alternate/Corporate Income Tax rate as per the Income Tax Act, 1961 (as amended from time to time) of the respective financial year directly without making any application before the Commission as provided in Tariff Regulations 2019 and Tariff Regulations, 2024 as per para 14 and 15 above for respective block.

d) Approve the reimbursement of expenditure by the beneficiaries towards petition filing fee, and expenditure on publishing of notices in newspapers in terms of Regulation 94 (1) Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2024, and other expenditure (if any) in relation to the filing of petition.

e) Allow the petitioner to bill and recover RLDC fees & charges and Licensee fee separately from the respondents in terms of Regulation 94 (3) and (4) Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2024.

f) Allow the petitioner to bill and adjust impact on Interest on Loan due to change in Interest rate on account of floating rate of interest applicable during 2024-29 period, if any, from the respondents.

g) Allow the petitioner to file a separate petition before the Commission for claiming the overall security expenses and consequential IOWC on that security expenses as mentioned at para 21 above.

h) Allow the petitioner to file a separate petition before the Commission for claiming the overall insurance expenses and consequential IOWC on that insurance expenses as mentioned at para 21 above.

i) Allow the petitioner to file a separate petition before the Commission for claiming the overall capital spares at the end of tariff block as per actual as mentioned at Para 21 above.

j) Allow the petitioner to claim expenses of CTUIL borne by POWERGRID through a separate petition as mentioned at para 22 above.

k) Allow the Petitioner to bill and recover GST on Transmission Charges separately from the respondents, if GST on transmission is levied at any rate in future. Further, any taxes including GST and duties including cess etc. imposed by any statutory/Govt./municipal authorities shall be allowed to be recovered from the beneficiaries. and pass such other relief as the Commission deems fit and appropriate under the circumstances of the case and in the interest of justice.”

3. The brief facts of the case are as under:

(a) The Investment Approval (the IA) for implementation of the transmission assets under the transmission project was accorded by the Board of Directors (BoD) of the Petitioner in its 265th meeting dated 27.12.2011 (vide Memorandum No. C/CP/SRSS-XIV dated 27.12.2011) with an estimated cost of ₹ 29733 lakh, including IDC of ₹ 16447 lakh based on the 3 rd quarter 2011 price level.

(b) The Revised Cost Estimate-I (RCE-I) in respect of the transmission project was accorded by the BoD of the Petitioner Company in its 309th meeting dated 29.1.2015 (vide Memorandum No. C/CP/RCE-SR dated 23.2.2015) with an estimated cost of ₹ 34679 lakh, including IDC of ₹ 3690 lakh based on the August 2014 price level.

(c) Subsequently, Revised Cost Estimate-II (RCE-II) in respect of the transmission project was accorded by the BoD of the Petitioner Company in its 351st meeting dated 16.3.2018 (vide Memorandum No. C/CP/PA1718-12-0O-RCE009 dated 28.3.2018) with an estimated cost of ₹ 53402 lakh, including IDC of ₹ 10859 lakh based on the October 2017 price level.

(d) The scope of the transmission project was discussed and agreed upon in the 30th meeting of the Standing Committee on Power System Planning of Southern Region held on 13.4.2010. The same was further agreed upon by the Southern Regional Power Committee in its 13th meeting held on 11.5.2010. The Petitioner has been entrusted with the implementation of the transmission project “System Strengthening XIV in Southern Region”.

(e) The scope of the transmission project is as follows: Transmission Line i. Dharmapuri (Salem New) – Somanhalli 400 kV D/C Quad line Sub-station

i. Augmentation of Hosur Sub-station by 1x315 MVA 400/220 kV Transformer and associated bays

ii. Extension of 400/220 kV Sub-station at Somanhalli

iii. Extension of 400/220 kV Sub-station at Dharmapuri (Salem New)

(f) The transmission assets under the transmission project have been completed. The Commission, vide Order dated 28.8.2020 in Petition No. 496/TT/2019, trued-up the transmission tariff for the 2014-19 tariff period and determined the transmission tariff in respect of Asset-1 for the 2019- 24 tariff period. Further, the Commission, vide Order dated 2.9.2022 in Petition no. 16/TT/2022, trued-up the transmission tariff for the 2014-19 tariff period and determined the transmission tariff in respect of the Asset2 for the 2019-24 tariff period.

4. The Respondents include Distribution Licensees, Power Departments, and ‘Designated Inter State Transmission Customers' (‘DICs’) that receive transmission services from the Petitioner, primarily benefiting the Southern Region.

5. The Petitioner has served a copy of the Petition on the Respondents, and notice regarding the filing of this Petition has also been published in the newspapers in accordance with Section 64 of the Electricity Act, 2003 (the Act). However, no comments or suggestions have been received from the general public in response to the aforesaid notices published in the newspapers. None of the Respondents have filed their reply to the present Petition.

6. The hearing in the matter was held on 30.9.2025, and the Order was reserved. This Order is being passed considering the main Petition filed vide affidavit dated 7.10.2024 and an affidavit dated 18.8.2025 in which the Petitioner filed an additional submission in response to the Technical Validation letter dated 31.7.2025 of the Commission.

7. Before proceeding with the truing up of the tariff, it is important to note that the Commission in its Order dated 2.9.2022 in Petition No. 16/TT/2022 determining the tariff for Asset-2 for the 2019-24 period, directed the Petitioner to submit the CEA Energisation Certificate for the 400 kV Dharmapuri (Salem New)-Somanhalli 400 kV D/C Quad Line (a component of Asset-2) at the time of truing up of tariff for the period 2019-24. The Petitioner has submitted the same in the instant Petition. Further, regarding the Commissions direction for the CMD Certificate issued vide T.V. letter for the assets in this Petition, the Petitioner vide its affidavit dated 18.8.2025 has submitted that the requirement to furnish this certificate for the transmission assets commissioned on or after 6.4.2016, was formally instituted vide fourth amendment to the IEGC, 2016, Accordingly, the CMD Certificate for Asset-2 , the COD of which is after 6.4.2016, has been submitted. Therefore, the Petitioner has complied with the directions of the Commission to furnish both the CEA Energisation Certificate and the CMD Certificate. Further, in response to the Commission’s TV letter, the Petitioner vide affidavit 18.8.2025 submitted that all the assets under the transmission scheme have been completed and are covered under the instant Petition.

8. Now, we proceed to dispose of the Petition based on the submissions of the Petitioner.