The Central Electricity Regulatory Commission (CERC) has urged to grant compensation package for Adani Power's Mundra project which would provide a cushion against the escalation in cost of imported coal for the plant.

Adani Power had approached the CERC, seeking revision in tariff from its 1,980-MW Mundra project in Gujarat saying increase in imported fuel cost. CERC in its order state that in order to offset increase in cost of imported coal, till the international price of the commodity is stabilised, the company should be provided with some relief.

CERC in its order has said that in order to offset increase in cost of imported coal, till the international price of the commodity is stabilised, the company should be provided with some relief. The compensation package known as 'compensatory tariff' and it could be variable in nature in proportion with the hardship that the company is suffering on account of the unforeseen events. It had led to non-availability of coal linkage or increase in international coal price affecting the import of coal which has further impacted its performance under the PPA.

Accordingly, CERC directed constitution of a Committee consisting of the Principal Secretaries of the concerned states and CMDs of the concerned distribution companies, chairman of the Petitioner company or his nominee, an independent financial analyst and an eminent banker to recommend the compensatory tariff within a period of one month.