CASE NO. 3 of 1997

06.03.97 The matter of direct sale of energy by M/s. ICCL to M/s. PPL was taken up today. M/s. ICCL is represented by Shri B. J . Panda, JMD, Shri S.K. Pattnaik, Sr. Vice President, Shri S.K. Nanda, Sr. Adviser and Shri S. Das, Asst. Manager (P&C). Gridco is represented by Shri Mahendra Kumar, Director (Commercial ) M/s . PPL represented by Shri Q. S. D. Pandey, DGM and Shri A. K. Satapathy and State Government, Deptt. of Energy is represented by Shri B. Mishra, OSD-cum-Dy. Secretary.

Commission wanted to get clarification from all concerned parties on the legal position of the permission granted to M/s. ICCL for sale of power to M/s. PPL under Section 28 of the Indian Electricity Act, 1910 under the changed circumstances after the Orissa Electricity Reform Act, 1995 has come into operation .

Heard the representatives of M/s. ICCL. M,/s. ICCL indicated that such sale of power to third party by their captive power Plant has been granted by the State Govt. as OSEB was not prepared to purchase surplus power at a remunerative rate from M/s. ICCL. M,/s. ICCL had entered into a bi-partite agreement with OSEB during November, 1994 for sale of power to M/s. PPL with effect from 01.12.94. M/S ICCL claimed that four more years are left of the agreement made with M/s. PPL for sale of power. M/s. ICCL also explained their difficulties in not meeting the requirement of supply of 10 MW surplus power to OSEB/Gridco because the frequency in Gridco's system did not allow them to do so . The Gridco did not maintain the frequency limit as provided in the Electricity Rules, 1956. M/s . ICCL has also furnished a written submission dated 3rd March, 97 in which they have indicated for grant of exemption as provided in the OER Act, 1995 under section 16 (1). In their oral submission during the hearing they confirmed that the intention was to ask for an exemption as provided in OER Act instead of issue of a license which had been earlier requested due to wrong reading of law.

Gridco submitted that there is no written condition in the agreement signed during November, 1994 stipulating the requirement of frequency as a pre-condition. Excursion of frequency in the grid is a Regional feature where Gridco is a part of Eastern Region Grid and therefore, frequency discipline was sometimes beyond the control of Gridco. The representative of Gridco further reiterated their written submission stating that ICCL have failed to supply minimum 10 MW power to Gridco during a month on an average basis in as much as they have complied with such supply Only for 7 months out of 25 months. Gridco wanted some time to verify the information on supply made by ICCL to Gridco segregating the normal frequency period and abnormal frequency period and the validity of the reason for failure on the part of ICCL in not injecting 10 MW on an average per month. Gridco pointed out their difficulty in assessing such power supply due to their difficulty in monitoring the despatch of generating stations. Gridco also pointed out that such frequency excursion were also prevalent prior to the agreement i.e. November, 1994.

M/s. ICCL countered this contention stating that such frequency excursion has been very acute after the Super Thermal Power Station at Kaniha was commissioned after November, 1994. Gridco, contended that the present sale of power by ICCL to PPL is affecting their revenue adversely as in a cross subsidised tariff structure industrial consumers compensate the loss incurred on sale to domestic consumers. However, representatives of Gridco stated that they may not have objection for such sale of power to PPL if ICCL sticks to their agreement of supplying 10 MW surplus power on an average every month to Gridco. Representative of M/s. PPL expressed their desire to continue their power Or supply agreement with ICCL. In the meanwhile, Govt. of Orissa, Deptt. Of Energy in their written submission dtd. 28.2.97 to the Commission have stated that the present low cost power being purchased from CPPs should be continued and future purchases from other likely CPPs are to be planned along with IPP purchases. In the same communication the State Govt. has indicated that steps have been taken to frame a fresh policy guidelines on third party sale of power in consultation with Gridco shortly.

Ordered that the present arrangement of sale of power by M/S. ICCL to M/s. PPL shall continue for the time being. Gridco will submit a report to the commission explaining their claim of not receiving 10 MW power from ICCL and will furnish a copy of the same to M/S. ICCL by 2nd of April, 1997. The matter is posted to 22nd April 1997 for further hearing.

A.R. MOHANTY

D.K. ROY

Order No. 002 dated 15.03.97

15.03.97 Hearing fixed on 22nd April,1997 is now refixed to 29th April,1997 at 11.00 A.M .

A. R. MOHANTY

D.K. ROY

Order No. 003 dated 26 th April, 1997

26.04.97 The Gridco's letter dated 25.04.97, in response to the direction made in the course of hearing on 06.03.97 has been seen. In the light of the prayer made by Gridco in filing the rejoinder is condoned .

A .R . MOHANTY

D .K . ROY

Order No. 004 dated 29 th April, 1997

29.04.97 M/s. Indian Charge Chrome Limited (ICCL), the petitioner represented by Mrs. Anuradha Dutta, Advocate, Shri S.K.Nanda, Sr.Advisor (Power), Shri S.K.Pattnaik , Sr.Vice-president and Shri Sanjeev Das , Asst. Manager (Power & Coal).

M/s. GRIDCO, the affected party represented by Shri Mahendra Kumar, Director (Commerce) . State Government represented by Shri B.Mishra, OSD-cum-Dy.Secretary, Deptt. of Energy.

M/s. Paradeep Phosphate Limited (PPL), the affected party represented by Shri A.K.Samantsinghar, Manager (CPP) and Shri A.K.Satpathy, Dy. Manger (Commercial).

Heard the representatives of M/s. ICCL, Gridco and representatives of state Government. M/s. ICCL appealed to the commission to give some time to file their rejoinder to the Gridco's counter dated 25 th April , 1997 and further they appealed to supply Dept. of Energy letter No. 3600 dt. 28.02.97 for their reference. Representative of state Govt. informed the commission that they would shortly decide the policy on third party sale by the CPP after consultation with Gridco and Industry Dept. Gridco submitted to hold the hearing after such finalisation of policy of state Govt. and it would be about end of May , 1997.

Next date of hearing will be notified to the applicant/affected parties.

A.R MOHANTY

D.K.ROY

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