Supreme Court Rules Coal Shortage Costs Must Be Shared Equally Among Power Buyers, Upholds APTEL Ruling

New Delhi, Sep 9 (KNN) The Supreme Court upheld a ruling by the Appellate Tribunal for Electricity (APTEL), dismissing appeals from discoms. The apex court affirmed that costs related to coal shortages must be shared fairly among all electricity purchasers that buy electricity from a power plant. The court also added that no discom has the right to claim priority for power supply in the event of coal shortage.

The dispute heard by the bench of Chief Justice of India BR Gavai and Justice K Vinod Chandran arose from a coal shortfall at the GKEL power plant in Odisha, which led to the use of costly imported coal. The fact at issue was whether the additional costs should be distributed proportionately among all electricity purchasers or if they should be borne by only affected discoms.

Appeals were filed by both Haryana Utilities and GRIDCO of Odisha, who had each claimed preferential rights to the power supply. The Supreme Court upheld the previous rulings by Central Electricity Regulatory Commission (CERC) and APTEL that the costs should be shared proportionately.

The apex court while passing the judgement in the case- Haryana Power Purchase Centre (HPPC) and Others versus GMR Kamalanga Energy Limited and Others observed, “None of the DISCOMS can claim a priority for supply of power based either on the prior date of agreement or the recital as to the source of coal.”

Further, on the point of law, the Supreme Court also noted that appeals under Section 125 of the Electricity Act can only be made on a ‘substantial question of law’ and unless the findings are not in violation of statutory provisions, intervention by the court is not permissible. ​​​​​​

(KNN Bureau)