Jagan Govt Embarrassed with its Move of Terminating PPAs

Jagan Govt Embarrassed with its Move of Terminating PPAsIn what can be termed as a significant change in its earlier stance, Andhra Pradesh government has told in the high court it has realized that renewable power contracts with developers cannot be terminated and was embarrassed by its move towards this, but said power purchase agreements need to be renegotiated.

The Government earlier insisted that wind and solar energy plants to revise their tariff to Rs 2.43 per unit and Rs 2.44 per unit, respectively, with retrospective effect. Now, the government said it is open to negotiations about the Tariff rates. The government says that the electricity distribution companies in the state will go bust if the energy department continues to pay for wind and solar power at current tariffs.

The companies, however, say any negotiations in the signed PPAs will have an adverse effect on their balance sheets. They demanded the court to direct adherence to all terms of the power purchase agreements, including payment to the companies.

The next hearing of the case will take place on September 18 for rejoinder submissions by companies.

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