The Madras High Court has issued an interim stay on a communication from the Tamil Nadu Green Energy Corporation Ltd (TNGECL) that directed the suspension of upcoming solar and wind power projects in the state. The communication cited irregularities in approvals and a review of previously issued consent letters.
Scope of the Stay
As many as 226 solar projects with a combined capacity of 736.5 megawatts (MW), along with seven wind projects totaling 400 MW, were placed under abeyance by TNGECL. The stay was granted by Justice G.R. Swaminathan while hearing a writ petition filed by SunPro Renewable Energy Pvt Ltd on Friday.
Petitioner's Arguments
The petitioner argued that it had made significant investments and obtained bank guarantees based on due approvals from the power utility. The company informed the court that it had commenced work on establishing a 230 kV pooling substation to evacuate 150 MW of solar power, investing approximately Rs 675 crore in land and equipment. Counsel for the petitioner stated that any delay in completing the project would result in penalties and substantial financial losses.
Background of the Dispute
Earlier, the no-objection certificates, feasibility studies, and registrations issued to solar and wind projects between March 1 and May 19 were put on hold after R. Nirmalkumar assumed office as the state electricity minister. The minister alleged that the department had detected irregularities in the approval process for renewable energy projects.
In the wake of these allegations, Tamil Nadu Electricity Board's Chief Financial Controller V. Kasi and Chief Engineer for Non-Conventional Energy Sources P. Chandrasekaran were suspended. Departmental action was also initiated against retired Director Mangalanathan.
Court's Observation
Recording the submissions, Justice Swaminathan ordered an interim stay on the impugned communication, noting that the petitioner had raised serious concerns about the legality and constitutionality of the order. The court found merit in the argument that the suspension was arbitrary and could cause irreparable harm to the petitioner's business interests.
Impact on Renewable Energy Sector
The stay is expected to provide relief to developers of renewable energy projects in Tamil Nadu, who had faced uncertainty following TNGECL's directive. The decision underscores the judiciary's role in ensuring that administrative actions do not unduly hinder investments in the green energy sector.
