Former SC judge to head panel to end power logjam
Standoff between Adani Power, state over purchase agreements
The state government has formed a high-level committee under Justice Krishna Murari, a former SC judge, to end the logjam between Adani Power Limited (APL) and the state’s power distribution companies over the power purchase agreements (PPAs).
Issuing a notification, Shyamal Misra, Additional Chief Secretary, Energy Department, mandated it to “examine the viability of PPAs with existing tariff structure and suggest mitigation measures to ensure long-term viability.” SD Dubey, former Chairman, Central Electricity Authority (CEA), and TC Gupta, Chief Commissioner, Haryana Right to Service Commission, were named other members.
The committee will analyse documents related to the APL Mundra Thermal Power Plant, especially units 7 to 9, which supply power to Haryana. “It will analyse and ascertain any hardship faced by (APL) and manner for mitigating them considering the actual costs incurred by APL for delivery of power at Haryana periphery as compared to the quoted energy charge rate under the PPAs,” it said.
Under the long-term PPAs between Haryana and APL, the distribution companies—Dakshin Haryana Bijli Vitran Nigam (DHBVN) and Uttar Haryana Bijli Vitran Nigam (UHBVN)—were contracted to buy 1,424 MW of electricity (712 MW each) from the Mundra plant for a 25-year period in 2008. However, under supplementary PPAs signed later, this contracted capacity was revised, with each discom scheduled to receive 600 MW of power, resulting in a combined supply of 1,200 MW to Haryana. However, the standoff between the APL and the government disrupted the supply.
It was contended that the agreements were signed at a time when fuel and operational costs were lower, but subsequent increases in coal prices and other inputs have made supply at the contracted rates unviable. The Mundra plant relies partly on imported coal, and fluctuations in international coal prices have increased fuel costs, it was claimed.
The committee will ask the Haryana Power Purchase Committee (HPPC) and the APL to submit details/clarifications to find “amicable solution for all the pending claims and counter-claims of the discoms and the APL”. It will also take a call on the rights and obligations of the APL and discoms relating to the payment security mechanism (PSM).
The committee has also been mandated to examine the viability of PPA with existing tariff structure and suggest mitigation measures to ensure long-term viability. Suggesting other measures for reduction in the cost of generation also falls within the terms of reference.
The committee shall finalise its recommendations, preferably within a period of 180 days, the notification added. The Chief Engineer/HPPC, UHBVN, Panchkula, shall act as a Nodal Officer for presenting the documents before the committee.
