In the matter of the CERC (Procedure, Terms and Conditions for grant of Trading Licence and other related matters) Regulations of ISTL in electricity from Category ‘V’ to Category ‘IV’ – EQ
Summary:
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### 1. Background of the Petitioner
– **Petitioner:** Ideal Energy Solutions Private Limited, a company registered in Kolkata.
– **Existing Licence:** The company was originally granted a **Category ‘V’ inter-State trading licence** by CERC on March 22, 2022, through Petition No. 262/TD/2021.
– **Category ‘V’ Limit:** A Category ‘V’ licensee is permitted to trade electricity up to **500 Million Units (MUs) per financial year.**
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### 2. Reason for Upgradation
The Petitioner cited the following reasons for seeking an upgrade to Category ‘IV’:
– **Improved Market Conditions:** A positive outlook and growth in the power market.
– **Future Business Potential:** The company anticipates a significant increase in its power trading volume.
– **Regulatory Compliance:** The company acknowledged that it had **exceeded the permissible trading limit of 500 MUs** for a Category ‘V’ licensee in September 2025, triggering the need for an upgrade.
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### 3. Applicable Regulations
The application was governed by the following key regulations of the Trading Licence Regulations, 2020:
– **Regulation 9(4):** Mandates that a trading licensee must apply for an upgrade or downgrade of its licence to fulfill the conditions of the regulations, following the procedure specified in Regulation 15.
– **Regulation 15(1):** Lays down the procedure for upgradation:
– A licensee can apply for a higher category at any time based on proposed trading volume.
– The application must be filed as soon as the licensee expects to exceed the volume limit for its existing category.
– The licensee must submit an **audited special balance sheet** to prove compliance with the net worth requirement for the higher category.
– The licensee must pay the applicable licence fee or the differential fee for the higher category.
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### 4. Financial Eligibility Criteria for Category ‘IV’
To qualify for a Category ‘IV’ inter-State trading licence, Regulation 3(3)(a) of the Trading Licence Regulations, 2020, requires an applicant to have a **minimum net worth of Rs. 10 crore** (Rs. 100 million) as on the date of the special audited balance sheet accompanying the petition.
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