VIJAYAWADA: In the wake of State government’s move to review the Power Purchase Agreements (PPAs) signed by the previous TDP regime, the Centre has asked AP to desist from revisiting PPAs as it will shake the confidence of investors in the power sector and affect the future bids and investments in the country.
In a communique sent to Chief Secretary LV Subramanyam, Union Secretary (Ministry of New and Renewable Energy) Anand Kumar has mentioned that a contractual agreement once signed should not be revisited unless there is a specific provision to do so in the agreement or a case of conspiracy and undue gains.
Endorsing the procedures involved in various renewable energy developers signing PPAs with the State government, he said under Section 62 of the Electricity Act, the tariff is fixed by the State Electricity Regulatory Commission (SERC) in compliance with Central Electricity Regulatory Authority guidelines and under Section 63 of the Electricity Act and the tariff is arrived at through transparent open competitive bidding basis. In both the cases, SERCs conduct public hearings before adopting the tariffs and signing the PPAs, he said.
Stating that the Centre set a target of installing 175 GW of Renewable Energy Capacity in the country by 2022, including 100 GW from solar, 60 GW from wind, 10 GW from biomass and 5 GV from small hydro units, he observed that in case any PPAs are revisited without a valid reason it will affect the national programme.
In fact, Chief Minister YS Jagan Mohan Reddy in his maiden press conference in Delhi after calling on Prime Minister Narendra Modi, faulted the PPAs signed by the TDP regime with regard to wind energy and announced to review them to bring down the tariff from the present Rs 4.76 to Rs 2.50 per unit.
After coming across the reports relating to the issue, the Union Secretary sent the communique to the Chief Secretary urging him to apprise the Chief Minister of the repercussions of revisiting PPAs.