CERC comes to rescue of coal shortage hit Adani Power

Adani Power, which was disallowed by the Supreme Court to pass on higher imported coal prices to consumers, has got relief from Central Electricity Regulatory Authority (CERC).

The regulator has allowed full compensation to Adani Power for its Mundra Thermal Power Plant in Gujarat.

In September 2010, Indonesia had barred selling its coal to another country less than international prices, which spiralled generation costs of Adani Power.

Last month, the Supreme Court had ruled against claiming compensation from the electricity distribution companies for costlier imported coal due to policy changes by another country.

However, it allowed some reliefs under the provision of ‘change in law’ in India.

In April 2015, the government withdrew customs and countervailing duty on coal imports by Adani Power. In fact, even the imported coal used for the power plant was brought under the clean energy cess. Apart from these, it had also withdrawn service tax exemption.

After Adani Power filed a petition with CERC, the authority in its order has allowed ‘change in law’ for customs duty, clean energy cess, countervailing duty, service tax, etc.

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