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The Rajasthan Electricity Regulatory Commission (RERC) received petitions from Ratedi Wind Power Pvt Ltd, Tanot Wind Power Ventures Pvt Ltd, Khandke Wind Energy Pvt Ltd, and Lalpur Wind Energy Pvt Ltd. These companies requested compensation for additional expenses they incurred due to the installation of bird diverters on transmission lines. This requirement arose from Supreme Court orders in 2021 and 2022 aimed at protecting the endangered Great Indian Bustard (GIB) and Lesser Florican species. The petitioners claimed that this unexpected cost was not included in the original tariffs approved by RERC under their Power Purchase Agreements (PPAs).
The Supreme Court had ordered all existing overhead power lines in GIB-priority and potential areas to either be converted into underground cables or, until such conversion, fitted with bird diverters. The Petitioners followed the directive and installed the diverters on their overhead lines, such as those for Ratedi Wind Power’s 26.4 MW wind power project in Jaisalmer, where 11,896 bird diverters were installed over 52 km of 33kV overhead lines.
The Petitioners argued that according to Article 12 of their PPAs, any change in law that affects project costs should be compensated. They referenced the Electricity (Timely Recovery of Costs due to Change in Law) Rules, 2021, which allow for cost adjustments through monthly bills or a one-time payment. Based on these rules, the companies approached the RERC seeking approval for the reimbursement mechanism.
Respondents, including Rajasthan Urja Vikas Nigam Limited and the three state distribution companies, argued that the PPAs did not promise restitution or apply the 2021 rules retroactively. They also claimed the Petitioners did not take prior approval from RERC before making investments in bird diverters and that the Petitioners’ areas were not strictly classified as “priority areas,” making the installation voluntary.
In reply, the Petitioners stressed that they were legally bound to comply with Supreme Court orders, which are applicable to all parties and thus qualify as “change in law” events. They noted that the Court’s direction was for both priority and potential areas and that the bird diverters were installed following technical guidelines finalized in consultation with the Central Electricity Authority.
The RERC considered the matter and acknowledged that the Supreme Court orders dated April 19, 2021, and April 21, 2022, do constitute a change in law under the PPAs. The Commission held that the additional cost incurred for the installation of bird diverters after the bid submission dates is eligible for compensation. It allowed the Petitioners to recover this cost through monthly annuity payments over 15 years or the remaining term of the PPAs, whichever is less, using a discount rate of 9%. The Commission also approved carrying costs, provided that supporting documents are submitted.
The RERC directed all parties to reconcile claims with detailed documentation and auditor certifications to ensure that the compensation accurately reflects the expenditure. Once the supplementary bill is raised, late payment surcharge clauses from the PPAs will apply if payments are delayed.
