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1.1 The Appellants are aggrieved by the Impugned Order in as much as the TNERC has:

(i) passed the Impugned order without hearing stakeholders before rejecting their submission in complete violation of Section 64 (3) of the Electricity Act, 2003;
(ii) passed the Impugned Order without recording any reasons for determining various components of the tariff;
(iii) Determined the tariff in complete derogation of its own power procurement regulation, financial and accounting principles;

2. Brief Facts of the Case:-

2.1 Appeal No. 118 of 2016 has been filed by the Appellant, M/s Welspun Renewables Energy Private Limited which is involved in Electricity generation from RE sources including solar & wind power projects. It has developed its own EPC capabilities.
2.2 Appeal No. 151 of 2016 has been filed by the Appellant, National Solar Energy Federation of India (NSEFI), is an umbrella organization representing Solar Energy Companies active along the whole photo voltaic value chain : project developers, manufacturers, engineering companies, financing institutions and other Appeal Nos. 118 & 151 of 2016 stakeholders. It was founded in 2013 by Solar Energy Industry leaders with the vision to promote solar energy. 2.3 The Respondent No.1, Tamil Nadu Electricity Regulatory Commission (Respondent Commission/ State Commission) is the Electricity Regulatory Commission for the State of Tamil Nadu exercising jurisdiction and discharging functions in terms of the Electricity Act, 2003.
9.2.2 Many stakeholders have sought an increase in the capital cost ranging from Rs.5.55.Crores/MW to Rs.6.10 Crores/MW citing high land cost, increased cost involved in civil works, mounting structures depending on soil conditions and labour cost in the State. Neyveli Lignite Corporation Ltd.(NLC) has stated that the proposed capital cost is low and that the reduction in cost of modules is off set by the increase of prices in other components and has requested to furnish the break up cost. The CERC issued a draft order No. 17/SM/2015 dated 23/12/2015 in the matter of Determination of Benchmark Capital cost norm for Solar PV power projects and Solar Thermal power projects for the financial year 2016-17. In this order, the CERC has determined Rs.5.0132 Crores per MW for Solar PV plant. This includes module costs, land cost, cost towards civil and structural works, cost of power conditioning unit, cost of evacuation of power and preliminary and pre-operative expenses including IDC. Module degradation of 0.6% has been accounted for in the capital cost. TANGEDCO has suggested to adopt the capital cost of Rs.5.0132 Crores/MW as proposed by CERC. The stakeholders have expressed views that the reduction in prices of module cost is temporary and to consider the increase in exchange rate variation. The Commission has observed that each bidding by different state utilities for solar energy finds a new low in terms of cost of energy. Various stakeholders attribute various reasons for such low tariffs. Some of them have said that these prices are unsustainable. However, the fact remains that the prices for solar energy continue to fall and has reached as low as Rs.4.34 per unit as on date.(as per available information). In view of this, the Commission is not inclined to alter the capital cost indicated in the consultative paper. The Commission decides to adopt a capital cost of Rs. 5.05 Crores per MW which includes all the components and degradation of modules."
"Analysis and Decision Appeal Nos. 118 & 151 of 2016 Several stakeholders have pointed out that assuming a drop of 11% in module prices might be unjustified, as the module prices have stabilized over last few months. Module price trends, starting April 2015, are as below: ...
While the spot prices reflect short term market rates, for planned projects, it is a standard practice for developers to negotiate price and quantity ahead of time. However, given quality concerns and to ensure life of 25 years, we must consider Tier-1 module prices. Industry players such as Adani Power, Tata Solar, Welspun etc. have also suggested that module prices be considered at $0.48/W. Thereby, the Commission sets module prices at $0.48/W, assuming prices are expected to be fairly stable in the coming year. Regarding the domestic content requirement, the Commission would like to clarify that the present exercise of benchmark capital cost is for generic tariff and not for project specific projects."