The imposition of safeguard duty has reportedly led to a clash over tariffs between NTPC and developer Acme Solar.
According to ET Acme Solar has filed a petition against NTPC in the Delhi high court for introducing new conditions in the letter of intent issued in mid-October. Acme solar bagged 600 MW in a 2,000 MW solar auction held by NTPC in August, winners of the remaining 1,400 MW have not objected to the changes.The petition has been admitted and heard.
Acme Solar wrote to NTPC in response to the letter of intent “It is submitted that introduction of new conditions once the bidding process has been completed, is not permissible in law.” Second hearing will be held soon confirmed NTPC to the publication.
The publication notes that the dispute is over the tariff NTPC should pay Acme. In the initial bid in early July, when safeguard duty was expected, Acme quoted Rs 2.59 per unit, inclusive of safeguard duty in case it came about.
In the actual reverse bidding held in August, Acme altered its bid to Rs 2.53 per unit, excluding safeguard duty. When asked, it quantified the impact of safeguard duty at 31 paise per unit.
NTPC’s letter of intent focuses entirely on Acme’s first bid of Rs 2.59 per unit. It said “In case safeguard duty is not paid… for whatsoever reason, the implication of 31 paise will be deducted from the final tariff of Rs 2.59… In such case, the final tariff payable will be Rs 2.28.” However, Acme maintains that 31 paise should be added to its revised bid of Rs 2.53 per unit to account for the safeguard duty and NTPC should pay it Rs 2.84 per unit. It also objected to NTPC splitting the tariff into components.
Acme in its letter stated that “There is no legal basis for NTPC to seek to split the discovered tariff of Rs 2.59 per kwH into two parts – Rs 2.28 per kwH and Rs 0.31 per kwH.”