Petition for determination of the tariff for “Transmission System for Kurnool Wind Energy Zone/Solar Energy Zone(AP) – Part-A & B’’ in the Southern Region – EQ

Summary:

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## **1. Case Overview**

| **Parameter** | **Details** |
| — | — |
| **Petitioner** | Power Grid Corporation of India Limited (PGCIL) |
| **Respondents** | Tamil Nadu Power Distribution Corporation Limited (TNPDCL) & others |
| **Subject** | Determination of tariff for transmission assets under the **Kurnool Wind/Solar Energy Zone (Andhra Pradesh)** |
| **Assets Covered** | – 765/400/220 kV Substation at Kurnool-III (new) – Extension of 765 kV Kurnool (New) Substation – 765 kV Kurnool-III – Kurnool (New) D/C Line |
| **Scheme Name** | “Transmission System for Kurnool Wind Energy Zone / Solar Energy Zone (AP) – Part A & Part B” (Southern Region) |
| **Hearing Date** | 19 March 2026 |
| **Status** | **Reserved for order** after hearing arguments |

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## **2. Key Business & Regulatory Implications**

### **2.1 Tariff Framework**
– Petition filed under:
– **Section 62** (determination of tariff by Commission)
– **Section 79(1)(d)** (CERC’s function to regulate tariff of inter-state transmission)
– **CERC Tariff Regulations, 2024** (new regulations applicable)
– **CERC Conduct of Business Regulations, 2023**

### **2.2 Interim Tariff Request**
– PGCIL requested the Commission to **allow interim tariff** pending final tariff determination.
– This is a common practice to ensure **cash flow for transmission assets** that are already commissioned or partially commissioned.

### **2.3 Arguments & Next Steps**
– Both PGCIL and TNPDCL concluded oral arguments.
– CERC permitted both sides to file **written submissions / notes of arguments** within **10 days**.
– After that, the matter was **reserved for order** – meaning CERC will now deliberate and issue a final ruling.

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## **3. Strategic Business Takeaways**

| **Aspect** | **Impact / Insight** |
| — | — |
| **Renewable energy zone development** | Kurnool Wind/Solar Energy Zone is critical for evacuating large-scale renewable power from Andhra Pradesh to Southern Region load centers (including Tamil Nadu). |
| **Transmission tariff certainty** | Final order will set the revenue stream for PGCIL on these assets – affects PGCIL’s return on equity, interest on loans, O&M expenses, etc. as per CERC Tariff Regulations 2024. |
| **Interim tariff importance** | If allowed, interim tariff ensures PGCIL gets paid during the regulatory lag – important for project financing and lender confidence. |
| **State DISCOM opposition risk** | TNPDCL is a respondent – typical for DISCOMs to argue for lower tariff to reduce power purchase cost. Outcome may set a precedent for similar renewable evacuation projects. |
| **Regulatory timeline** | With hearing complete and matter reserved for order, decision likely in **3–6 months** (typical CERC timeline). |

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## **4. Recommended Action for Stakeholders**

– **For PGCIL / CTUIL**:
– Prepare robust justification for interim tariff citing regulatory precedents and project commissioning status.
– Submit written arguments within 10 days as directed.

– **For DISCOMs (TNPDCL & others)**:
– File counter-arguments focusing on prudence check of capital expenditure, efficiency of asset utilization, and any delays in commissioning.

– **For renewable energy developers in Kurnool zone**:
– Monitor this order closely – transmission tariff affects overall landed cost of power and open access charges.

– **For investors / lenders**:
– Interim tariff decision will signal CERC’s approach under the **2024 Tariff Regulations** – useful for financial modeling of similar transmission projects.

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