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The CERC through its order dated 04.02.2026 in Avaada Sunrays Energy Private Limited v. NHPC Ltd. & Ors.1, has held that the increase in GST on solar power generating systems pursuant to the notification dated 30.09.2021 and the additional compliance requirements arising from the Supreme Court's order dated 19.04.2021 relating to protection of the Great Indian Bustard ("GIB Order") qualify as Change in Law events under the PPA in the said matter.
The petition was filed seeking compensation for additional expenditure incurred due to the increase in the applicable rate of GST on solar power generating systems, and due to compliance with the directions under the GIB Order requiring installation of bird diverters and related measures for overhead transmission lines in GIB habitat areas.
CERC held that both the GST notification dated 30.09.2021 and the GIB Order have the force of law and have directly resulted in additional costs to the project and therefore, constitute Change in Law events. The CERC allowed reimbursement of the additional expenditure along with carrying cost, subject to reconciliation and one-to-one correlation of invoices supported by auditor certification
Footnote
1 Petition No. 294/MP/2024.
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