Unfair Gaps🇮🇳 India

Solar Electric Power Generation Business Guide

13Documented Cases
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All 13 Documented Cases

PPA अनुपालन लागत और प्रदर्शन दंड (PPA Compliance Costs & Performance Penalties)

Logic-based estimate: ₹30-100 lakhs annually per 100-200 MW project. Breakdown: (1) Performance penalty exposure: 0.5-2% of PPA revenue = ₹25-100 lakhs; (2) Compliance costs: 20-40 person-hours/month × ₹5,000/hour = ₹10-20 lakhs/year; (3) SERC filing and regulatory response: ₹5-15 lakhs/year.

PPAs specify performance standards (Plant Availability Factor targets, ramp-rate limits, reactive power limits) with corresponding penalties[2][3]. Solar generators must: (a) monitor hourly/daily performance against targets, (b) calculate and declare penalties, (c) comply with SERC filing requirements, (d) respond to auditor tests on revenue/penalty calculations. Manual compliance creates: (a) Penalty amount disputes with offtakers, (b) Missed penalty recovery opportunities, (c) Compliance documentation burden (legal, accounting, regulatory filings).

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अधूरे दस्तावेज़ों के कारण क्लेम मूल्यांकन त्रुटि

40-60 hours manual effort per claim (ops/finance staff) = ₹20,000–₹30,000 cost per claim. Claim rejection due to timeline breach: ₹1.5–₹3 lakh loss.

Claims approved/rejected based on documentation completeness. Missing invoices, unclear photos, absent repair estimates, or incomplete FIR copies force manual follow-up. Multiple resubmission cycles delay approval. If claim notice filed >1 year after damage, rejected per policy terms regardless of merit.

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Ind AS 115 लागू विफलता और ऑडिट योग्यता (Ind AS 115 Application Failures & Audit Qualification)

Logic-based estimate: ₹5-50 lakhs per audit qualification event. Restatement liability: ₹10-100 lakhs (restating revenue, receivables, deferred tax). Stock exchange fine: ₹5-25 lakhs per violation. Estimated frequency: 1-2 audit qualifications per 500-1000 MW portfolio per annum.

Ind AS 115 compliance failures in solar PPAs include: (a) Incorrect performance obligation identification (failing to separate power delivery from RECs)[1], (b) Misstated transaction price allocation (not using SSP correctly)[1], (c) Timing errors (recognizing revenue at billing rather than control transfer), (d) Penalty/incentive miscalculations. Auditors must evaluate PPA structure and revenue recognition methods[2][4]. Non-compliance leads to: audit qualification, restatement liability, and potential penalties from SEBI/stock exchanges.

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DISCOM विलंबित भुगतान और NPL जोखिम (DISCOM Payment Delays & Non-Payment Loss)

Logic-based estimate: ₹20-80 lakhs annually per 100 MW project. Assumed ₹5 crore annual PPA revenue, 90-day average cash cycle vs. 30-day contracted term = 60 days excess float × ₹1.4 crore average receivables balance × 8% cost of capital ≈ ₹33 lakhs. Plus ECL provision (1-5% of DISCOM receivables = ₹5-25 lakhs). Total: ₹38-58 lakhs/year.

DISCOM payment failures are systemic in India. While contracts specify 30-day payment terms with 2% p.a. surcharge for delays[1], state DISCOMs routinely delay 60-180 days. Under Ind AS 115, revenue must be recognized when control transfers (upon delivery), but ECL provisions must account for DISCOM default risk[1]. This creates: (a) revenue recognized but cash not collected for 3-6 months, (b) surcharge amounts billed but not recovered, (c) ECL provision required, reducing reported profits.

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