Petition of the CERC (Conduct of Business) and (Terms and Conditions of Tariff) Regulations for Truing up and determination of the transmission tariff for MSETCL owned Transmission Lines/Systems to other States – EQ

Summary:

—

## **1. Case Overview**

| **Parameter** | **Details** |
| — | — |
| **Petitioner** | Maharashtra State Electricity Transmission Company Limited (MSETCL) |
| **Respondents** | Power Grid Corporation of India Limited (PGCIL) and others (including KPTCL) |
| **Subject** | Truing up of transmission tariff for **2019–24 period** (under Tariff Regulations 2019) and determination of tariff for **2024–29 period** (under Tariff Regulations 2024) |
| **Assets Covered** | **9 transmission assets** owned by MSETCL that **convey electricity to other States** (i.e., inter-state transmission elements) |
| **Hearing Date** | 19 March 2026 |
| **Next Hearing** | **14 May 2026** |
| **Current Status** | **Admission stage** – notices issued, information sought, reply pending |

—

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

### **2.1 Why This Petition Matters**
– MSETCL is a **state transmission utility (STU)** , but certain transmission lines conveying power **to other States** fall under CERC’s jurisdiction (inter-state transmission).
– This petition covers **nine specific assets** – likely critical for **Maharashtra’s power exchange with neighboring states** (e.g., Karnataka, Gujarat, Madhya Pradesh).

### **2.2 Dual Tariff Periods**
– **2019–24 (Truing up)**: Adjusting actual vs. allowed costs – capital expenditure, return on equity, O&M, interest, income tax, etc.
– **2024–29 (Determination)**: Setting fresh tariff under the **new 2024 Regulations** – lower return on equity (RoE) likely, stricter efficiency norms.

### **2.3 KPTCL’s Intervention**
– **Karnataka Power Transmission Corporation Limited (KPTCL)** is Respondent No. 5 and sought **4 weeks to file reply** – indicating cross-state interest, possibly as a **buyer of Maharashtra power** or sharing transmission charges.

—

## **3. Strategic Business Takeaways**

| **Aspect** | **Impact / Insight** |
| — | — |
| **Inter-state tariff determination** | Sets precedent for how STU assets used for inter-state power flow are regulated – affects open access charges and power purchase costs for neighboring DISCOMs. |
| **Regulatory transition (2019 → 2024 regulations)** | MSETCL will be among early cases under **2024 Tariff Regulations** – outcome will signal CERC’s stance on RoE, ACE prudence, and O&M norms. |
| **Additional Capex scrutiny** | CERC specifically asking for ACE justification for 3 out of 9 assets – suggests possible disallowance if not properly documented. |
| **KPTCL’s role** | Karnataka’s interest indicates either: <br> – Power flow from Maharashtra to Karnataka via these lines, or <br> – Sharing of transmission charges under regional pooling mechanism. |
| **Form-7 requirement** | Form-7 is a key CERC filing for transmission tariff – contains actual vs. approved capital cost, financing details, and tariff calculations. |

—

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

– **For MSETCL**:
– Quickly compile ACE supporting documents for Assets IV, V, VII.
– Ensure liability flow statement reconciles with audited accounts.
– Prepare response to likely objections from KPTCL and PGCIL.

– **For KPTCL & other Respondents**:
– File detailed reply challenging any inflated capex or inefficient O&M.
– Assess impact on Karnataka’s power purchase cost if MSETCL’s tariff is approved as claimed.

– **For PGCIL** (as Respondent):
– Likely to argue for consistency with national transmission tariff framework – may oppose any state-specific deviations.

– **For DISCOMs buying power from Maharashtra**:
– Monitor case – higher transmission tariff increases landed cost of power.

– **For investors in STU transmission assets**:
– The case shows **STUs can claim inter-state tariff** – but under tighter CERC scrutiny and longer timelines.

—

For more information please see below link: