CERC Holds It Has Jurisdiction Over Payment And PPA Disputes Involving Composite Generation Schemes

CERC by its order dated 28.01.2026 in the matter of KSK Mahanadi Power Company Limited v. Southern Power Distribution Company of Andhra Pradesh Limited & Ors.¹, reaffirmed that, while CERC has jurisdiction over tariff related disputes arising from a composite scheme, it can exercise its discretion to refer such disputes to arbitration. In cases where the dispute is non-tariff in nature, such reference to arbitration is mandatory under Section 79(1)(f) of EA 2003.

The generator approached CERC alleging non-payment of tariff, capacity charges and transmission charges and unilateral deductions from invoices by the distribution licensee and also challenged the termination of the PPA. The distribution licensees objected to CERC's jurisdiction, contending that the disputes were purely contractual money claims, not involving tariff determination or regulation, and therefore ought to be referred to arbitration or adjudicated by the State Commission under Section 86(1)(f) of