Andhra discoms secure APTEL backing in battery storage margin row

The Appellate Tribunal for Electricity (APTEL) has refused to grant a stay on the Andhra Pradesh Electricity Regulatory Commission's (APERC) order regarding margin caps on NHPC's battery storage operations, marking a significant development in the dispute between state distribution companies and the national hydropower utility.

APERC had capped NHPC's trading margin on the 500 MW battery storage project at 0.5 per cent of capacity charges, a substantially lower threshold than the 7 paise per unit margin that NHPC had sought to retain. The regulatory commission's decision aimed to protect consumer interests and reduce the cost burden on state discoms procuring power from the storage facility.

APTEL's decision to decline the stay request validates the APERC order and strengthens the position of Andhra Pradesh's distribution companies in their efforts to manage energy procurement costs. The tribunal's refusal to intervene suggests the regulatory framework governing battery storage margins will proceed as established by the state regulator.

The dispute reflects ongoing tensions over pricing mechanisms in India's emerging battery storage sector, where utilities and regulators are still calibrating margins that balance operational viability with consumer affordability. NHPC's battery storage project represents a significant infrastructure investment aimed at addressing peak-hour power deficits in the region.

The APTEL ruling is expected to influence similar margin disputes across other states as battery storage capacity expands and becomes an increasingly critical component of India's electricity supply chain.