“Where the Appropriate Commission(s) has already framed regulations, they shall be amended to include provisions on the criteria for choosing the modalities to determine the tariff, in case they have not been already included,” the court said.
The Supreme Court on Wednesday directed all the state electricity regulatory commissions to frame within three months rules under the Electricity Act-2003 on the terms and conditions for determination of tariff.
The ruling came while the court dismissed an appeal by Tata Power Company Limited Transmission, challenging the February 18, 2022 order of the Appellate Tribunal that had dismissed an appeal filed by it against the decision of Maharashtra Electricity Regulatory Commission (MERC) under the Act to grant transmission licence to Adani Electricity Mumbai Infra Limited (AEMIL) for setting up a 1,000 MW High Voltage Direct Current (Voltage Source Converter based) link.
The three-judge bench of Chief Justice D Y Chandrachud and Justices A S Bopanna and J B Pardiwala noted that the 2003 Act “was enacted with the objective of providing the States with sufficient flexibility to regulate the intra-state electricity system and simultaneously provided the regulatory commissions with the power to determine tariffs” and that “though the government, both at the Centre and in the States, have framed statutory policies and guidelines regulating the electricity sector, we have noticed that the Regulatory Commissions have not framed the necessary regulations to put into effect the principles prescribed under the Act”.
It said that “while framing these guidelines on determination of tariff, the Appropriate Commission shall be guided by the principles prescribed in Section 61 (of the Act), which also includes the National Electricity Policy and National Tariff Policy (NTP)”.
“Where the Appropriate Commission(s) has already framed regulations, they shall be amended to include provisions on the criteria for choosing the modalities to determine the tariff, in case they have not been already included”, the court said.