Petition with CERC (Procedure, Terms and Conditions for Grant of Transmission License and other related matters) Regulations to Transmission License to SR WR Power Transmission Ltd – EQ

Summary:

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#### Business & Regulatory Summary

This Record of Proceedings (RoP) documents the initial hearing for two interconnected petitions filed by SWPTL, a special purpose vehicle (SPV) created to implement a specific transmission project. Key business highlights include:

– **Corporate Structure:** SWPTL is a 100% wholly owned subsidiary of PGCIL, India’s central transmission utility. This structure is typical for project-specific SPVs to ring-fence project assets and liabilities.
– **Project Origin:** The transmission system was awarded to SWPTL through a tariff-based competitive bidding process. Petition 884/AT/2025 seeks CERC’s formal “adoption” of the transmission charges discovered through that bidding process, which is a mandatory step under Section 63 of the Electricity Act.
– **License Requirement:** Petition 885/TL/2025 is a parallel application seeking the necessary Transmission License from CERC to legally operate the transmission assets once constructed.
– **Core Controversy:** The key dispute, raised by TNP DCL (the Tamil Nadu distribution utility), concerns the classification of the transmission component. The question is whether it should be treated as a **”National Component”** or a **”Regional Component.”** This classification has significant financial implications because it determines how the transmission charges are shared among all beneficiaries (states) under the CERC Sharing Regulations. National components are typically socialized across all users, while regional components are borne by the beneficiaries of that specific region.
– **Regulatory Clarity Sought:** TNP DCL has asked CTUIL (the central transmission utility responsible for planning) to clarify this classification. CTUIL requested and was granted time to file its reply.

#### Key Directives & Procedural Developments

The Commission issued the following directions during the hearing:

1. **CTUIL to File Reply (within one week):** CTUIL was directed to file a formal reply, specifically addressing the issue raised by TNP DCL regarding the transmission component’s classification (National vs. Regional). This reply is crucial as CTUIL is the agency responsible for transmission planning.
2. **Listing for Further Hearing:** The matter was scheduled for the next hearing on **February 24, 2026**, allowing time for CTUIL’s reply and for other parties to respond.

#### Strategic & Business Implications for Stakeholders

**For SR WR Power Transmission Limited (SWPTL / PGCIL):**

– **Project Timeline Risk:** The delay in resolving the classification issue could push back the final grant of the license and tariff adoption, impacting the project’s financial closure and construction schedule.
– **Tariff Certainty:** SWPTL’s position is that its tariff was bid in accordance with the extant Sharing Regulations, and it expects that tariff to be adopted regardless of the classification. However, a change in classification could alter the payment mechanism or the pool of entities paying the tariff, potentially leading to disputes or delays in revenue recovery.
– **Passive Role in Dispute:** SWPTL has strategically distanced itself from the planning dispute, correctly pointing out that it is a project implementer, not the planning authority. It has left the classification issue to CTUIL to defend.

**For Tamil Nadu Power Distribution Corporation Limited (TNP DCL – Respondent):**

– **Protecting Consumer Interest:** TNP DCL is actively intervening to ensure that the project’s classification does not lead to an unfair cost burden on Tamil Nadu’s electricity consumers. If the component is classified as “Regional” but should be “National,” Tamil Nadu could end up paying more than its fair share.
– **Seeking Regulatory Precedent:** By raising this issue, TNP DCL is forcing the Commission to provide clarity on the classification of this specific transmission asset, which will set a precedent for how similar assets are treated in the future.

**For Central Transmission Utility of India Limited (CTUIL – Respondent):**

– **Accountability for Planning:** CTUIL is being called upon to defend its planning decisions. Its reply must justify the original classification of the transmission component, providing the technical and economic rationale.
– **Role as System Planner:** This proceeding reinforces CTUIL’s critical role as the central planning authority. Its submissions will heavily influence the Commission’s final decision on cost allocation.

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