Transmission project cost and IDC determinations require fresh regulatory consideration.

The appellant, a transmission licensee under Section 14 of the Electricity Act, 2003, developed a 132 kV transmission system to evacuate power from its 24 MW Dikshi Small Hydro Electric Project

It sought approval of the system’s Aggregate Revenue Requirement and transmission charges for FYs 2019–20 to 2021–22.

The Commission approved a capital cost of ₹50.7 crore and interest during construction (IDC) of ₹9.05 crore, below the appellant’s claims of ₹63.58 crore and ₹11.36 crore respectively.

The appellant appealed, challenging the Commission’s assessment of civil-works costs and IDC.

During the appeal hearing, the Commission’s counsel stated that the matter could be remanded for reconsideration.

1. Whether the Commission’s assessment of civil-works costs and IDC, including its restriction of those amounts below the appellant’s claims, required reconsideration

2. Whether the impugned order should be set aside and the tariff petition remanded to the Commission for fresh consideration

The appellant relied on Regulation 4.3 of the Arunachal Pradesh State Electricity Regulatory Commission (Multi-Year Tariff) Regulations, 2018, contending that the Commission’s prudence check should not consist of mechanically selecting the lowest among contract rates, rates in the PGCIL Detailed Project Report, and actual costs

The Tribunal did not interpret that regulation or apply any cited precedent; it ordered reconsideration in light of the issues raised and the Commission’s position before it

The Tribunal recorded the appellant’s challenge to the Commission’s method of assessing civil-works costs and its consequential restriction of IDC, notwithstanding that time overruns had been condoned

It did not decide whether the Commission’s methodology or approved amounts were legally or factually correct.

Instead, given the Commission’s counsel’s statement supporting remand and the corresponding prayer in its written submissions, the Tribunal considered fresh consideration by the Commission appropriate

It directed the Commission to endeavour to complete the exercise within three months and allowed the appeal to that limited extent; pending interlocutory applications, if any, were disposed of