The Maharashtra Electricity Regulatory Commission (“MERC”) in a detailed order dated 03/06/2021 in the case of Exide Industries Limited (“Exide”) has held that in the State of Maharashtra, Additional Surcharge is not applicable on a non-group / single captive consumer, but only on the group captive consumers of a power plant having multiple consumers. It also held that a consumer cannot be termed as a group captive consumer merely because its units are located at different places and have separate electricity connections.
The petition (Case No. 10 of 2021) was filed by Exide challenging the levy and recovery of Additional Surcharge by Maharashtra State Electricity Distribution Co. Ltd. (“MSEDCL”) on the captive consumption of electricity by Exide, which holds 27.19% equity shareholding in the generating company and is a sole captive consumer of the generating station.
MSEDCL sought to claim that only such arrangement, where the captive consumer has 100% shareholding in the generating station, can be termed as non-group captive power plant. Thwarting the said argument, MERC hold that the Electricity Rules, 2005 allows even a single captive user with minimum equity shareholding of 26% in the power plant to be a captive user of the plant which can consume minimum 51% energy generated from the power plant. Allowing the petition and holding the levy as illegal, MERC directed MSEDCL to refund the amounts collected towards Additional Surcharge to Exide.
MSEDCL also sought to raise an issue that if there is a purchase and sale of electricity, such arrangement cannot be treated as a captive arrangement as envisaged under the Electricity Act, 2003. However, MERC observed that this issue is general in nature and cannot be answered in this petition and thus, granted a liberty to MSEDCL to agitate the same by filing a new petition, making all the captive consumers a party.
The judgment can be found at: https://www.merc.gov.in/faces/merc/common/outputClient.xhtml
Comments