Applicants under multiple long-term power purchase agreements sought declarations that the respondent miscalculated Total Market Cost after the 2011 global adjustment reallocation regime came into force.
The court held that the contractual definition of TMC implicitly required aggregated electricity costs to be allocated pro rata based on electricity consumption, and that the respondent's new formula improperly reflected a regulatory reallocation between customer classes rather than the underlying costs of generation and supply.
Although the court found the respondent breached the PPAs, it also held that neither the change of law clauses nor the material change provisions were triggered by the reallocation regulation.
Declaratory and consequential relief was granted requiring recalculation from January 1, 2011 and compensation with interest.
