Clarity on whether Anil Ambani’s Reliance Power will go ahead with the proposal to acquire Jaiprakash Power Ventures’ hydro power portfolio will emerge by September 25.

The exclusivity period given to Reliance Power in the memorandum of understanding for the deal inked in July-end between the entities concludes on the said date.

The fate of the estimated ₹12,300-crore deal is delicately poised, as according to a banking source close to the development, “The final valuation of the deal will naturally be dependent on the capacity and tariff as finally approved for the Karcham Wangtoo project as both are currently pending before Central Electricity Authority (CEA) and Central Electricity Regulatory Commission (CERC), respectively.” The deal was particularly important for the debt-laden Jaypee Group which is selling assets to reduce its loans. The group which has over ₹56,000-crore debt, plans to trim it by ₹15,000 crore in the current fiscal.

Analysts are quick to point out that exclusivity period can always be extended, but the two factors — capacity and tariff — will weigh on Reliance Power when taking a final call.

The Central Electricity Authority’s fact finding committee report on JPVL’s project in Himachal Pradesh, states that the developer violated norms to increase the installed capacity by 200 MW taking it to 1200 MW. JPVL has also withdrawn its application before the CERC for interim tariff of the electricity generated from Karcham Wangto. On September 16, hearing the petition for withdrawal of petition for fixation of provisional tariff of the generating station, CERC directed JPVL to expedite filing of the tariff petition for the period 2014-19 in accordance with the 2014 Tariff Regulations, in order to determine the tariff of the generating station for the said period. The matter is listed for hearing on September 30. While considering the report of the CEA’s fact finding committee, which said that JPVL had violated norms to increase the installed capacity by 200 MW to make it 1200 MW, the apex body of the Authority is understood to have discussed that the developer restricts capacity to 1000 MW plus 10 per cent, as is the present norm. Various penalties were also discussed.

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