Amend power purchase pact: Firm

PATIALA: Following a recent Supreme Court verdict, Tata Power has written to Punjab, Haryana and other states, seeking an amendment to the power purchase agreement (PPA) based on the recommendations of the high power committee constituted by the government of Gujarat.
In its letter sent to principal secretary, power, Punjab, Tata Power has claimed that despite the expected tariff revision the company will make substantial losses.But the three-member high power committee report based on which the Supreme Court had passed the orders has claimed that the three power plants — the 4,000 MW Coastal Gujarat Power Limited of Tata Power, 4,620 MW at Mundra, Adani Power Mundra Limited and 1,200 MW Essar Power Gujarat Power Limited at Salaya — would get a combined benefit of Rs 1.29 lakh crore in the next 30 years if the recommendations are implemented.
According to the claim made by Tata Power, the tariff revision will be in the range of Rs 3 per unit, which is Re 1 less then the average power purchase costs. A 50 paise per unit deduction from energy charges has been allowed as lenders contribution of 20 paise per unit and 30 paise against profit from coal mines.
The Gujarat government had approached the SC for directions based on the report of an expert panel that suggested altering the PPAs. Earlier, in April 2017, the Supreme Court had rejected the claims of these power suppliers. To bail out these power producers, Gujarat government constituted a three-member committee, based on the report of which the Supreme Court passed the recent orders directing the Central Electricity Regulatory Commission (CERC) to resolve the issue that had arisen due to rise in the cost of imported Indonesian coal that was used at these power plants.
In its letter Tata Power stated that it had been supplying power to all procurer states since 2012, but due to the promulgation of the Indonesian Regulations-2010 and the consequent increase in the price of Indonesian coal, these plants started suffering huge financial losses. Tata Power’s lone losses have accumulated to Rs 8,000 crores till March 31, making the operation of the plant unsustainable, the letter has claimed.
The Gujarat government in July this year constituted a high-powered committee comprising R K Agrawal, former Justice of Supreme Court, S S Mundra, former deputy governor of the RBI) and Pramod Deo, former chairman of CERC to make recommendations for resolving the issues pertinent to the imported coal based power plants located in Gujarat.
The HPC analysed and examined all the issues and based on consensus and submitted its recommendations to the Gujarat government in October 2018, subsequent to which the Gujarat government approached the SC seeking approval on amending the existing PPAs of these power plants.