New Delhi, 04th August 2026: JSA Advocates & Solicitors (JSA) was successful in obtaining an interim relief from Supreme Court in favour of a Captive Power Generator [Sarda Metals & Alloys Ltd. ("Sarda")]. The Supreme Court has directed that Sarda is required to fulfil Renewable Power Purchase Obligation ("RPPO") at 5% only, in terms of Ministry of Power's ("MoP") Directive dated 01.10.2019 and is NOT required to meet higher % of RPPO prescribed in the Regulations framed by Andhra Pradesh Electricity Regulatory Commission ("APERC").
The following brief facts are noteworthy: –
(a) On 01.10.2019, MoP issued a Directive under the Tariff Policy, 2016 enacted under Section 3 of the Electricity Act, 2003, to hold that the RPPO of CPPs commissioned before 01.04.2016 shall be 'capped' at the RPPO rate decided by the appropriate commission for FY 2015-16.
(b) Sarda's CPP was commissioned prior to 01.04.2016. The prevailing RPPO rate determined by APERC during FY 2015-16 was 5%. Therefore, Sarda's had prayed for its RPPO to be capped at 5% as per the MoP Directive dated 01.10.2019.
(c) Since APERC failed to give effect to MoP's Directive dated 01.10.2019 in its RPPO Regulations, 2017 [for FY 2017-22] and 2022 [for FY 2022-27], Sarda challenged the constitutionality of APERC's RPPO Regulations 2017 and 2022 before High Court of Andhra Pradesh.
(d) By Judgement dated 22.04.2026, while High Court of Andhra Pradesh, rightly upheld Sarda's challenge to the RPPO Regulations 2022 and directed APERC to consider amending them in view of MoP's Directive dated 01.10.2019, however, rejected Sarda's challenge to the constitutionality of RPPO Regulations 2017 on the ground of limitation.
(e) Aggrieved thereby, Sarda challenged High Court of Andhra Pradesh's Judgement dated 22.04.2026 before the Supreme Court, to the extent Sarda's challenge to the constitutionality of RPPO Regulations 2017 was rejected.
By interim order dated 03.08.2026, Supreme Court stayed all RPPO demands issued upon Sarda in terms of RPPO Regulations, 2017 [for the period from FY 2017-18 to FY 2021-22].
This is a notable and a first of its kind order, where Supreme Court has granted 100% interim protection to a CPP against RPPO demands issued in contravention of MoP's Directive dated 01.10.2019.
Our Disputes team comprised Poonam Verma Sengupta, Lead Partner; Saunak Rajguru, Principal Associate;and Pradyumn Amit Sharma, Associate.