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2.2 The State Government notified the Transfer Scheme under the State Reforms Act of 1999 wherein all functions, assets and liabilities relating to transmission and distribution of the erstwhile Electricity Board were vested with APTRANSCO. All Power Purchase and Wheeling Agreements entered into earlier with the erstwhile Electricity Board came to be vested in the APTRANSCO. The developers of power projects which were commissioned after 1.2.1999 also entered into similar Power Purchase and Wheeling Agreements with APTRANSCO. On 3.4.1999 the State Commission was constituted under the provisions of the State Reforms Act, 1998.

2.3 On 06.3.2000 the State Commission after hearing all concerned directed APTRANSCO to follow Government of India guidelines and adopt power purchase price of Rs. 2.25 per unit with 5% escalation p.a. with 1994-95 as base year and Appeal nos. 150, 166, 168, 172, 173 of 2011 and 9, 18,26, 29, and 38 of 2012 this would be effective for a period of 10 years from 1994-95 i.e. till 31st March 2004. It was also decided that a suo motu review of the incentives from 1.4.2004 would be undertaken by the State Commission after discussion with all concerned parties and there would be further review of purchase price with reference to each developer on completion of 10 years from date of commissioning of the project. The Commission also decided that beginning from the billing month of December 2000 the non-conventional energy developers would not be permitted to sell power to third parties and would supply power to APTRANSCO.

2.7 Several non-conventional energy developers approached the High Court of Andhra Pradesh in Appeal against the State Commission's order dated 20.6.2001. Some developers accepted the State Commission's order and entered into Power Purchase Agreements with APTRANSCO pursuant to the said order of the State Commission. Several biomass power plant which were established subsequently also entered into PPAs with APTRANSCO in view of the State Commission's order dated 20.6.2001.

Appeal nos. 150, 166, 168, 172, 173 of 2011 and 9, 18,26, 29, and 38 of 2012 23.3 These issues have already been considered by the Hon'ble Supreme Court in its judgment dated 8.7.2010. The relevant extracts are reproduced below:

"After the passing of this order the Developers entered into PPAs between the period August 2001 to 2002 and confirmed the acceptance and implementation of the order of 20th June, 2001. While providing different clauses relating to various facets of sale and distribution of generated power, PPAs under Articles 2.1 and 2.2, which we have already reproduced, contemplate specifically that the purchase of energy by APTRANSCO will be at the tariff provided under Article 2.2. Article 2.2 determines the rate at Rs. 2.25 per unit with escalation at 5% per annum with 1994-1995 as base year which is to be revised on 1st April of every year upto the year 2003-2004, beyond which the purchase price by APTRANSCO will be decided by the Regulatory Commission. Still a further review of purchase price is contemplated on completion of 10 years from the date of commissioning of the project when it will be reworked. In other words, there are specific stipulations provided under the PPAs, as well as in the order dated 20th June, 2001, for revision/review of purchase price. Clause 2.3 further clearly says that tariff is inclusive of all taxes, duties and levies. In other words, all the documents afore stated provide for a review including the guidelines issued by the Govt. of India".