Setback to Tatapower, Adani power and Essar power from Gujarat

According to the sources from Gujarat state government, an earlier resolution that allowed tata Power Mundra, Adani power and Essar power to charge higher tariffs, now stands cancelled. The state government sources said that the increase tariffs one now becoming unviable keeping in mind the supplementary power purchase agreements and reduced coal prices.

The notice issued by the state stated that a supplemental power purchase agreement (PPA) would be assigned to with Essar power. The PPA with tata Power is awaiting confirmation from the state government, whereas for Adani power, the case for a supplemental PPA is pending with theCentral Electricity Regulatory Commission (CERC).

CGPL is the ultra mega power project in Gujarat’S Mundra by Tata Power, who in their latest annual report, stated that CGPL could enter into a supplementary PPA in addition to the existing one, at a higher tariff with States, where is the notice by the Gujarat government that that the tariff of CGPL’s supplemental PPA would be lower than that signed with other states.

The mentioned annual report of Tata Power stated that,  “According to the legal opinion received, even if Mundra supplies power as per the tariff discovered through the competitive bidding process to five states under a single PPA, in order to implement the HPC recommendations, CGPL can enter into separate supplemental PPAs with each procurer”. This report further mentioned that CGPL is following up the Gujarat and Maharashtra state government to sign separate individual PPAs.

Meanwhile, the HPC has been founded by Gujarat government to formulate a release plan for imported coal based plants in Gujarat. The HPC recommended the fixed cost of unit be reduced by 20 pressure per unit, following a cut on portion of debt repayment by the lender. The variable charge would be revised monthly capped at $110 per tonne for 6,322 kilogram grade of coal, with any price escalation beyond it will be Borne by the developer. The supplemental PPA would follow a similar methodology where in the energy charge has now been reduced to  $90 per tonne.

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