Tangedco objects to certain elements of Warora-Kurnool transmission system declared under deemed commercial operation

The transmission project is envisaged to interconnect the Western Region with the Southern Region
| Photo Credit: Special Arrangement

Tamil Nadu Generation and Distribution Corporation Limited (Tangedco) has objected to certain elements of the Warora-Kurnool transmission system being declared under deemed commercial operation. The project was taken over by Adani Energy Solutions (formerly Adani Transmission Limited) in 2021.

The transmission project is envisaged to interconnect the Western Region with the Southern Region. It involves the laying of 1750 circuit kilometer (ckm) of transmission line traversing through the States of Maharashtra, Telangana, and Andhra Pradesh and the construction of one sub-station at Warangal, according to details available on the Adani Energy Solutions website.

The transmission project was to facilitate the import of 16,000 MW of power to the southern region. Tangedco has the highest power demand in the southern region.

Initially, Warora Kurnool Transmission Limited (WKTL), a fully owned subsidiary of Essel Infraprojects Limited, was selected as a successful bidder through the international tariff-based competitive bidding process to establish the transmission system.

WKTL entered into the transmission service agreement with Long Term Transmission Customers in the Southern Region on January 6, 2016, with Tangedco as a lead customer.

In March 2021, Adani Transmission signed a definitive agreement to acquire WKTL for an enterprise valuation of ₹3,370 crore.

The transmission project comprises seven elements, of which six belong to the southern region. The scheduled commercial operation date for the six elements was November 5, 2019. There were various delays in the execution of the project, as per the minutes of a meeting held by Tangedco with the beneficiaries of the project.

Meanwhile, WKTL said it declares April 23, 2023, as the deemed commercial operation date for elements 1 and 4 of the project, citing the approval granted for energisation by the Central Electricity Authority. It also said it is declaring the commercial operation date as per Article 6.2.1 of the transmission service agreement.

Element 1 involves the establishment of a substation at Warangal, and Element 4 involves laying a transmission line in Warangal. WKTL said it is eligible to claim tariffs from the date of deemed commercial operation.

In its letter to WKTL, Tangedco pointed out that for the declaration of commercial operation dates of elements 1 and 4 of the project, the Warora-Warangal line, which is element 2, and the Warangal-Hyderabad line, which is element 3, have to be commissioned as a prerequisite as per Schedule 3 of the transmission service agreement.

Tangedco said the delay in commissioning all the elements of the project is attributable to WKTL.

Since elements 2 and 3 are not commissioned, the transmission charges in respect of 1 and 4 cannot be put into the common pool and claimed from beneficiaries, it said.

The transmission charges have to be billed to WKTL until the completion of elements 2 and 3, Tangedco said.

It also sought payment of liquidated damages.

The beneficiaries have also decided to file a joint petition before CERC over the delay in the execution of the project.