Central Electricity Regulatory Commission (CERC), has asked Reliance Power Ltd to submit a report on the financial impacts of weak rupee and escalation in cost of construction on the 4,000 MW Sasan Ultra Mega Power Project of the company.
Earlier, Reliance Power Ltd, had submitted a petition to CERC seeking compensation under "Change in Law" clause.
RPower won the project in 2007 in a tariff based international competitive bidding after quoting the lowest levellised tariff of Rs. 1.19 per unit for 25 years.
However, after that the company had filed petitions with CERC seeking relief in terms of tariff increased considering " unprecedented, unforeseen and uncontrollable depreciation of the Indian rupee and Change in Law (mainly increase in taxes and input cost leading to an overall rise in construction cost of the plant) during the Construction period"
As per the Power Purchase Agreement (PPA) between the developer of the project and procurer of electricity, the company can approach CERC for any "Change in Law" during the construction period and fluctuation in the value of the rupee.
CERC has asked the company to quantify the above and submit the details in terms of the overall financial impacts of these factors on the Project.
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