TaxTMI 
TaxTMI 
2009 (5) TMI 906
X X X X Extracts X X X X
X X X X Extracts X X X X
....ance Infrastructure Ltd. (RInfra) is a generating as well as a distributing company within the meaning and provisions of the 2003 Act. All of them have been operating in the city of Mumbai including Suburban Mumbai of having approximately 384 sq. Km in area and the city of Mumbai having approximately 60 sq. Km in area. We may place on record that the aggregate capacity to generate electricity of TPC is 1777 MW of power. The generation capacity of the respondent RInfra is 500 MW, but it uses its power, as per its license, only to serve its own consumers. BACKGROUND FACTS The following factual matrix relevant for proper appreciation of the legal issues arising in the present case may be noticed. Indisputably TPC has been generating and supplying electricity to distribution licensees like RInfra and BEST for over a century. On or about 5th March, 1907 ; 3rd April, 1919 ; 15th November, 1921 and 19th November, 1953, the Bombay (Hydro-Electric) Licence ; the Andhra Valley (Hydro- Electric) Licence, the Nila Mula Valley (Hydro-Electric) Licence and Trombay Thermal Power Electric Licence respectively were granted to TPC to generate and supply power in terms thereof. Since 190....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n from its own proposed project instead of providing power from TPC. The committee submitted its report on or about 26th May, 1998. In its report it recommended for grant of approval for both the said projects. It was furthermore recommended that the additional power generated from RInfra's project be used only to meet the future growth in demand arising from the consumers of Mumbai. The Kukde Committee also recommended that first the then existing generation facility of TPC be fully utilized to meet the requirements of the current consumers of RInfra so as not to disturb the existing technical and commercial arrangement between TPC and RInfra. Subsequent thereto a `Principles of Agreement' (POA) was executed between TPC and RInfra on or about 31st January, 1998 inter alia providing that there be a minimum power purchase (`off-take') on the basis of `pay or take' in each financial year by RInfra on the basis of its consumer demand forecast. The POA also envisaged execution of a detailed Power Purchase Agreement by the parties. However, no such agreement ever fructified. Thereafter in 2000 the Maharashtra State Electricity Board [MSEB] gave consent to the Saphale p....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed that any amendment to such an agreement or arrangement would require prior permission of the MERC irrespective of whether such an agreement or arrangement was approved by the commission or not. MERC, on an application, filed by RInfra for direction to TPC to provide additional outlets, agreed to the position that distribution licensees, such as RInfra, can procure their power from any generating company in India and because of the said flexibility in the 2003 Act also directed it to enter into a PPA with TPC. On or about 18th January, 2006, BEST executed a PPA with TPC for purchase of 800 MW of power for a period of 10 years which was subsequently revised in terms of the MERC's order dated 7th July, 2006. The said PPA was submitted for approval of MERC on 27th December, 2006 which was registered as Petition No.87 of 2006. On or about 12th July, 2006 a Minutes of the Meeting (MoM) was signed between TPC (G) and TPC (D) for allocation of power to TPC (D). TPC (D) indicated requirement of 500 MW power from TPC (G) in the said MoM. A minor modification in the MoM was directed by MERC, pursuant whereto, on or about 16th March, 2006, TPC (D) entered into a PPA with TPC (G) for ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fect from 1st April, 2008. In relation to its own jurisdiction it was, however, opined that it can issue direction upon the generating companies in terms of Section 23 of 2003 Act. RInfra preferred an appeal thereagainst which was marked as Appeal No.143 of 2007. Two separate appeals were preferred by BEST and TPC questioning the interpretation of Section 23 of 2003 Act by the Commission which were marked as Appeal No.159 of 2007 and Appeal No. 14 of 2008 respectively. MERC while dealing with the application filed by RInfra for continuing the tariff for financial year 2007-2008 even beyond 31st March, 2008 till the tariff year 2008-2009, by an order dated 1 st April, 2008 clearly indicated that for the purpose of fixing the distribution tariff of all the three distribution licensees namely, BEST, TPC (D) and RInfra, based on the share of generation capacity of TPC (G), it will be proceeding in the manner as directed by the Commission in its order dated 6th November, 2007 approving the PPA entered into by and between TPC (G) and BEST and TPC (G) and TPC (D). Appellate Tribunal thereafter passed the impugned judgment on 7th April, 2008 in Appeal No.51 of 2007 filed by TPC against....
X X X X Extracts X X X X
X X X X Extracts X X X X
....decision with reasons'. It took into consideration the relevant provisions of law. It noticed its functions under Section 86 of the 2003 Act as also various Regulations framed thereunder. It placed on record that it had issued certain directives to the distribution licensees from time to time. It opined that submission of Power Purchase Agreements (PPA) for approval are imperative as the objective thereof is to remove any uncertainty that may be faced by the consumers of a distribution licensee who does not have any written terms and conditions. It opined that RInfra's recalcitrant attitude in seeking approval of the terms and conditions of its power procurement deserved to be deprecated, whereupon a warning was administered. Submissions of BEST before the Commission were :- (i) Ambit of approval process under Section 81(1)(b) of 2003 Act was required to be restricted to the price and the Commission had no power to reduce the quantum agreed by distribution licensee and the generating company under the PPA submitted for approval. (ii) Insertion of the word "including" before the words "the price" makes the intention of the legislature clear that the scope of the power to ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....erating Companies and other sources at the earliest. Also, REL-D should submit Power Purchase Arrangement for procurement of power from its own generating unit REL-G, for the Commission's approval, within one month of the issue of this Order. (D) In the past, in view of the prevailing supply shortage situation, the Commission has invoked its powers under Section 23 of the EA 2003, and has directed the distribution licensees to share the available generation capacity in a particular ratio, based on the share of non-coincident peak demand for FY 2006-07, and subsequently based on the share of the coincident peak demand for FY 2007- 08, since the coincident peak demand data was available by then. The situation in the previous years was compounded by the fact that there were no approved PPAs between the parties, and an important aspect like power procurement cannot operate in a vacuum. However, the Commission's powers to issue directions under Section 23 of the EA 2003 are wide and if necessary and found expedient, the Commission may issue such directions in future also, despite the existence of any or all the approved PPAs, in case of any shortfall in contracted capacity, in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tion the need of the first respondent in regard to the allocation of quantity of supply Upon considering the provisions of the Act and the Regulations, the Tribunal held : "102. We note from the above regulations that the Commission itself recognizes an agreement or an arrangement for long-term power procurement by a Distribution Licensee. Regulations require prior approval of the Commission for any change to an existing arrangement or agreement for long term procurement. When an arrangement for power procurement between TPC and BEST as also between TPC and REL does exist, how the Commission failed to consider the claim of REL. 103. We conclude from the aforementioned that the Commission has wide powers to regulate the quantity of energy that may be supplied by a generating company to a distribution licensee when both are under the jurisdiction of the same Commission. 104. It is not in dispute that the claims of REL have not been considered by the Commission while approving the PPA between the TPC(G) and BEST and arrangement between TPC(G) and TPC(D). It is also not in dispute that the approval of PPA and the arrangement has affected the allocation of power to REL. The int....
X X X X Extracts X X X X
X X X X Extracts X X X X
....llate Tribunal that the principle of natural justice had not been complied with. iii) Direction of the Tribunal to the Commission to take into consideration contribution towards depreciation and interest on loan elements of fixed costs of TPC generation capacity while considering the claim of RInfra is without any basis inasmuch as :- (a) Such direction of the Appellate Tribunal has the effect of recognizing ownership of consumers over the generation assets. The Act does not recognize any such right of ownership of consumers over the generating assets. (b) RInfra consumers have only paid towards costs of the generation of the power consumed by them, which the developer is entitled to recover as reasonable cost of electricity and return of his investment. If this argument is taken to its logical conclusion, every consumer of electricity, whether domestic, industrial or commercial, would claim ownership of generation plants for the purpose of supply of power to their respective areas. iv) 2003 Act must be interpreted not only having regard to history of legislation but also the purpose and object it seeks to achieve wherefor the Commission and the Tribunal were not only re....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gulating generation, distribution and supply of electrical energy which is in short supply in the country wherefor endeavour should be made to ascertain the object and purport not only by reading one of the provisions of the Act but the preamble thereof as also the other important provisions, namely Sections 2(70) ; 7 ; 10 ; 11 ; 23 ; 60 ; 86(1)(b) and 86(1)(f) of the 2003 Act. (vi) Only because the generation of electricity was taken outside the purview of the licensing regime, the same would not mean that a generator of an electrical energy would be entitled to free wheel its entire supply to any person it likes and in any quantity it likes. (vii) The chapter heading and the marginal note of Section 23 of 2003 Act cannot be resorted to for its interpretation as it is well settled that marginal notes do not control the meaning of the section. (viii) Chapter heading should not be treated to be containing provisions dealing with a particular subject matter as rigid compartment and it is not uncommon that a provision, rule or regulation relatable to one chapter is in fact interpreted, applied or related to other chapters of the same Act. (ix) The term "supply" having been d....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... for issuance of any direction to the generating company? (B) Whether the Commission while applying the provisions of Section 86(1)(b) of the Act could also take recourse to Sections 23 and 60 thereof? (C) Whether equitable allocation of power generated by a generating company is permissible? LEGISLATIVE HISTORY 1910 ACT The earliest statute relating to control of generation of supply, distribution of electrical energy which governed the field was Indian Electricity Act, 1910 (1910 Act). Part-II of the said Act provided for supply of energy. Section 3 thereof provided for grant of licence to any person to supply energy in any specified area and also to lay down or place electric supply-lines for the conveyance and transmission of energy. However, after coming into force the 1948 Act, such licences could be granted only upon consulting the State Electricity Boards constituted and incorporated under Sections 5 and 12 thereof. Section 22-B in the 1910 Act, which was inserted by Act 32 of 1959, provided for power to control the distribution and consumption of energy stating :- "Section 22B - Power to control the distribution and consumption of energy (1) If the State Government is ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... terms of the 1998 Act, the Regulatory Commission was conferred with the power to determine tariff for all sales by a generating company in terms of Section 22(1)(c) thereof. It further required in line with the provisions of the 1910 Act as also the 1948 Act, for the State Commission constituted thereunder to regulate investment approval for generation, transmission, distribution and supply of electricity to require the licensees to formulate prospective plans and schemes for the promotion of generation, transmission, distribution and supply of electricity and to devise proper power purchase and procurement process, and to regulate the assets and properties related to the electricity industry, etc. The 1998 Act did not envisage de-licensing of generating companies as in terms thereof the following requirements were to be complied with on the establishment and operations of a generating station: (a) Setting up a generating station requires approval of a Board (u/s 44 of Electricity Supply Act, 1948) (b) Sale of Power by a generating company of any person requires approval of the competent government (u/s 43A of Electricity Supply Act, 1948) (c) Investment approval for generating....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nsider appropriate. The Electricity Bill, 2001 has been finalized after extensive discussions and consultations with the States and all other stake holders and experts. 4. The main features of the Bill are as follows:- (i) Generation is being delicensed and captive generation is being freely permitted. Hydro projects would, however, need approval of the State Government and clearance from the Central Electricity Authority which would go into the issues of dam safety and optimal utilization of water resources. (ii) There would be a Transmission Utility at the Central as well as State level, which would be a Government company and have the responsibility of ensuring that the transmission network is developed in a planned and coordinated manner to meet the requirements of the sector. The load dispatch function could be kept with the Transmission Utility or separated. In the case of separation the load dispatch function would have to remain with a State Government organization/company." Section 2 is the interpretation section. Section 2(4) defines "appropriate Commission" to mean the Central Regulatory Commission referred to in sub-section (1) of section 76 or the State Regulator....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n of electricity. Section 7 enables a generating company to establish, operate and maintain a generating station without obtaining a licence if it complies with the technical standards relating to connectivity with the grid referred to in clause (b) of Section 73. Section 8, however, provides that a generating company intending to set up a hydro-generating station shall prepare and submit to the Authority for its concurrence, a scheme estimated to involve a capital expenditure exceeding such sum, as may be fixed by the Central Government from time to time by Notification. Section 9 provides for captive generation. Section 10 lays down duties of generating companies, sub-sections (1) and 2 whereof reads as under :- "10 - Duties of generating companies (1) Subject to the provisions of this Act, the duties of generating company shall be to establish, operate and maintain generating stations, tie-lines, sub-stations and dedicated transmission lines connected therewith in accordance with the provisions of this Act or the rules or regulations made thereunder. (2) A generating company may supply electricity to any licensee in accordance with this Act and the rules and regulations mad....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... market domination. It reads :- "The Appropriate Commission may issue such directions as it considers appropriate to a licensee or a generating company if such licensee or generating company enters into any agreement or abuses its dominant position or enters into a combination which is likely to cause or causes an adverse effect on competition in electricity industry." Section 86 provides for functions of State Commission, clauses (a), (b) and (f) of sub-section (1) whereof, read as under :- "Section 86 - Functions of State Commission (1) The State Commission shall discharge the following functions, namely:-- (a) determine the tariff for generation, supply, transmission and wheeling of electricity, wholesale, bulk or retail, as the case may be, within the State: PROVIDED that where open access has been permitted to a category of consumers under section 42, the State Commission shall determine only the wheeling charges and surcharge thereon, if any, for the said category of consumers; (b) regulate electricity purchase and procurement process of distribution licensees including the price at which electricity shall be procured from the generating companies or licensees or....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tive areas have been bearing the `depreciation' and interest on loan elements of the Fixed Cost of tariff. It furthermore without assigning any reason dismissed the appeals being Nos. 159 of 2007 and 14 of 2008. INTERPRETATION OF THE STATUTORY PROVISIONS A statute, as is well known, must be construed having regard to Parliamentary intent. For the said purpose it is open to a court not only to take into consideration the history of the legislation including the mischief sought to be remedied but also the objects and purpose it seeks to achieve. The 1910 Act provided for licensing of all the operators who were engaged not only in transmission and distribution of electricity but also generation thereof. Indisputably `electricity' comes within the purview of the public utility service. It, in the modern context, is a necessary item for the purpose of better living of the citizens. After India became independent and with the advent of industrialization as also for other reasons, the benefit of availing consumption of electrical energy not only remained with the urban areas but also extended to rural areas. With growth in industrialization as also trade and commerce in the count....
X X X X Extracts X X X X
X X X X Extracts X X X X
....irements. It is only in that view of the matter, the liberalization policy of the State provided for de-licensing of the generating companies. In terms of the said provision, the activities of the erstwhile licensees of power generation on the one hand and those of transmission and distribution in electricity on the other were separated. The concept of trading was brought thereunder for the first time. Trading activities are permitted subject to grant of licenses. Distribution of electricity was defined as licensed activity in terms whereof a holder of a license can supply power to a person for his own use. A licensee for the activity of transmission could own the wires/transmission lines constituting the part of their grid but it could not engage itself in the activity of buying or selling the electrical energy. The core question which, therefore, arises for consideration is as to whether despite the Parliamentary intent of giving a go-bye to its licensing policy to generating companies, whether through imposing stringent regulatory measures the same purpose should be allowed to be achieved? The Act is a consolidating statute. It brings within its purview generation, transmissi....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the Electricity Regulatory Commissions. Encouraging private sector participation, generation, transmission and the distribution of electricity became the statutory policy. The Parliament felt the need of harmonizing and rationalizing the provisions of the Act. De- licensing of generation as also grant of free permission of captive generation is one of the main features of the 2003 Act. It is clearly provided that only hydro-generating projects would need the approval of the State Commission and the Central Electricity Regulatory Authority. It recognized the need of prohibiting transmission licensees. It also for the first time provided for open access in transmission from the outset. It even provides where the distribution licensee proposes to undertake distribution of electricity for a specified area within the area of supply through another person, that person shall not be required to obtain separate licence. In terms of Section 7 of the 2003 Act, all persons are permitted to establish, operate and maintain a generating station. It can, in terms of Section 62(1)(a) of the 2003 Act, supply electricity to any licensee i.e. distribution licensee or trading licensee. The 2003 Act ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he purported object it sought to achieve by enacting Section 7 would lose its purpose. It, however, does not mean that Section 23 itself becomes unworkable as it would not be possible to secure equitable distribution and supply. The agreement of distribution (PPA) being subject to approval, indisputably the Commission would have the public interest in mind. It has power to approve a MOU which subserves the public interest. It, while granting such approval may also take into consideration the question as to whether the terms to be agreed are fair and just. SECTION 23 - DIRECTION BY THE COMMISSION Could a generating company, despite Section 11 be subjected to any direction by the Commission in terms of Section 23 of the 2003 Act? Whether chapter headings and marginal notes should be taken into consideration for the purpose of interpretation of the main provision are the questions? Chapter headings and the marginal note are parts of the statute. They have also been enacted by the Parliament. There cannot, thus, be any doubt that it can be used in aid of the construction. It is, however, well settled that if the wordings of the statutory provision are clear and unambiguous, construc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er inconsistent dicta, a selection of which are now considered, must be treated as erroneous." In Interpretation of Statutes, Fourth Edition, by Vepa P. Sarathi at page 347 it is stated :- `The heading of a chapter may be referred to in order to determine the sense of any doubtful expression in a section ranged under it. But it cannot control unambiguous expressions. It is true that a heading cannot control the interpretation of a clause if its meaning is otherwise plain and unambiguous, but it can certainly be referred to as indicating the general drift of the clause and affording a key to a better understanding of its meaning." Similarly in Principles of Statutory Interpretation by Justice G.P. Singh, upon noticing the conflicting opinion, the learned Author states:- " The view is now settled that the Headings or Titles prefixed to section or group of sections can be referred to in construing an Act of the Legislature." Chapter heading, therefore, is a permitted tool of interpretation. It is considered to be a preamble of that section to which it pertains. It may be taken recourse to where an ambiguity exists. However, where there does not exist any ambiguity, it can....
X X X X Extracts X X X X
X X X X Extracts X X X X
....8 ]. Relevance of marginal note was also taken note of in Ramesh Chand and Ors. v. State of U.P. and Ors., [ (1979) 4 SCC 776 ]. In Bombay Dyeing and Mfg. Co. Ltd. v. Bombay Environmental Action Group and Ors., [ (2006) 3 SCC 434 ], marginal note has been taken into consideration as an intrinsic part of the Section. In Deewan Singh and Ors. v. Rajendra Pd. Ardevi and Ors., [ 2007 (1) SCALE 32 ] it has been held that the marginal note may be taken into consideration for the purpose of proper construction of the provision although there is no ambiguity. Sarabjit Rick Singh v. Union of India (UOI), [ (2008) 2 SCC 417 ] follows Deewan Singh (supra). SUPPLY - CONTEXTUAL MEANING It was submitted by the respondents that in any event the word `supply' as used in Section 23 should be given the same meaning as is given to it in Section 2(70) of the Act i.e. the sale of electricity to a licensee or consumer. Accordingly by its very nature, supply would have a supplier and a receiver and any direction which is aimed at ensuring or regulating supply by its very nature would have to be directed to both the supplier and the receiver. However, when the question arises as to the meaning of a....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Co. Ltd. v. Swaran Singh, [ (2004) 3 SCC 297 ]. } Thus, in a case where interpretation of a Section vis-`-vis the scheme of the Act, the purport and object of the legislation, particularly having regard o the mischief it seeks to remedy; the chapter heading as also the marginal note, in our opinion, are relevant. PURPOSIVE CONSTRUCTION Legislation has an aim, it seeks to obviate some mischief, to supply an inadequacy, to effect a change of policy, to formulate a plan of government. That aim, that policy is not drawn like nitrogen, out of air ; it is evidenced in the language of the statute, as read in the light of other external manifestations of purpose. [See Justice Frankfurtir, Some Reflextions on the reading of Statutes, 47 Columbia LR 527, at page 538 (1947) ; Union of India v. Ranbaxy Laboratories Ltd. and others ; { (2008) 7 SACC 502 }and D. Purushotam Reddy and another vs. K. Sateesh, {(2008) 11 SCALE 73}]. ANALYSIS In this case the relevance of chapter heading is more for the purpose of arriving at a conclusion as to whether the arrangement and scheme of the statute is such it can be said be relatable to different types of licensees on the one hand and a generating compa....
X X X X Extracts X X X X
X X X X Extracts X X X X
....vides for the functions of the State Commission, clause (a) of sub-section (1) whereof empowers it to determine the tariff for generation, supply, transmission and wheeling of electricity. Clause (b) empowers it to regulate electricity purchase and procurement process of distribution licensees. Inevitably it speaks of PPA. PPA may provide for short term plan, a mid term plan or a long term plan. Depending upon the tenure of the plan, the requirement of the distribution licensee vis-`-vis its consumers ; the nature of supply and all other relevant considerations, approval thereof can be granted or refused. While exercising the said function necessarily the provisions of Section 23 may not be brought within its purview. While even exercising the said power the State Commission must be aware of the limitations thereto as also the purport and object of the 2003 Act. It has to take into consideration that PPA will have to be dealt with only in the manner provided therefor. The scheme of the Act, namely the generation of electricity is outside the licensing purview and subject to fulfillment of the conditions laid down under Section 42 of the Act a generating company may also supply di....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ot contemplated under the statutory scheme. If he is exercising his dominant position, Section 60 would come into play. It is only in a situation where a generator may abuse or misuse his position the Commission would be entitled to issue a direction. The regulatory regime of the Commission, thus, can be enforced against a generating company if the condition precedent therefor becomes applicable. INTERRETATION OF SECTION 86 Section 86(1)(b) provides for regulation of electricity purchase and procurement process of distribution licensees. In respect of generation its function is to determine, the tariff for generation as also in relation to supply; transmission and wheeling of electricity. Clause (b) of sub-section (1) of Section 86 provides to regulate electricity purchase and procurement process of distribution licensees including the price at which the electricity shall be procured from the generating companies or licenses or from other sources through agreements. As a part of the regulation it can also adjudicate upon disputes between the licensees and generating companies in regard to the implementation, application or interpretation of the provisions of the said agreement. T....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... Singhvi.A PPA may be a long term one or a short term one. Regulations have been made by the Commission by making MERC (Terms and Conditions of Tariff) Regulations, 2005. Short term power procurement refers to an agreement for procurement of power for a period of less than one year. Regulation 23.1 requires the distribution licensee to prepare a five year plan inter alia upon taking into consideration the sources for procurement thereof. Regulation 24.1 mandates obtaining of prior approval of the Commission therefor. Approval by Commission is granted upon examining the process of procurement having regard to the factors specified in Regulation 24.2. It is in the aforementioned context grant of approval of the PPA by and between TPC (G) on the one hand and BEST and TPC (D), on the other hand, necessitated. The proposal of TPC (G) that RInfra should enter with it a long term agreement assumes significance. RE: HARDSHIP OF RIinfra For the purpose of interpretation and/or application of a statute, this Court cannot base its decision on any hypothesis. Construction of a statute, save and except some exceptional cases, cannot be premised on the hardship of a party which may be suffere....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... companies would not be governed. 4) As almost all the sections preceding Section 23 as also Section 24 talk about licensee and licensee alone, the word "supply" if given its statutorily defined meaning as contained in Section 2(70) of the Act would lead to an anomalous situation as by reason thereof supply of electrical energy by the generating company to the consumers directly in terms of Section 12(2) of the Act as also by the transmission companies to the consumers would also come within its purview. 5) In a case of this nature the principle of exclusion of the definition of Section by resorting to "unless the context otherwise requires" should be resorted to. 6) Section 86(1)(a) of the 2003 Act clearly shows the para meters of supply for the purpose of Regulation, viz. supply of electricity by the distribution company to the consumer. 7) If regulatory clause is sought to be applied in relation to allocation of power, the same would defeat the de-licensing provisions. Generating companies have the freedom to enter into contract and in particular long term contracts with a distribution company subject to the regulatory provisions contained in the 2003 Act. . 8) PPA fo....