Auction for 2,500 MW pilot PPA scheme in January

By: |
Published: January 1, 2020 4:00:11 AM

The second batch of the auctions under this scheme was held earlier in 2019, but was recently cancelled due to tepid response from electricity distribution companies (discoms).

The tariff of Rs 4.41/unit was discovered in the cancelled auction, which buyers found to be too high. The tariff of Rs 4.41/unit was discovered in the cancelled auction, which buyers found to be too high.

The auction for selling 2,500 mega-watt (MW) power under the central government’s pilot scheme for stressed power plants is expected to be held in January, 2020, PTC India, the aggregator of the scheme, said on Tuesday. The second batch of the auctions under this scheme was held earlier in 2019, but was recently cancelled due to tepid response from electricity distribution companies (discoms).

The pilot scheme aims to sign power purchase agreements (PPAs) with electricity generating capacities which are stressed due to the lack of contracted buyers. The tariff of Rs 4.41/unit was discovered in the cancelled auction, which buyers found to be too high. According to industry sources, as many as 13 companies including Jindal Power, JSW Energy, Adani Power and Sembcorp emerged as the successful bidders in the cancelled round of auctions,.

In the first tranche of auction under the pilot scheme, only seven power plants with a combined capacity of 1,900 MW agreed to sell electricity against the call for 2,500 MW for Rs 4.24/unit. Though 4,000 MW of private generators competed for a similar quantum in the second round, the higher price led to its cancellation. PTC India has replaced NHPC as the aggregator for the second auction-round. It will sign PPAs with successful bidders and ink back-to-back power supply agreements separately with discoms interested in buying power from these units.

The pilot scheme and the Shakti scheme has helped the government to salvage commissioned power pants lying stranded, several due to the lack of PPAs. The government has managed to bring as many as 11 coal-based projects with combined capacity of 12.7 giga watt (GW) out of stress over the last six months.

Do you know What is Cash Reserve Ratio (CRR), Finance Bill, Fiscal Policy in India, Expenditure Budget, Customs Duty? FE Knowledge Desk explains each of these and more in detail at Financial Express Explained. Also get Live BSE/NSE Stock Prices, latest NAV of Mutual Funds, Best equity funds, Top Gainers, Top Losers on Financial Express. Don’t forget to try our free Income Tax Calculator tool.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Factory output in April may have shrunk by 40%; one week lockdown pushed March IIP to record low
2Rajiv Bajaj talks to Rahul Gandhi: Indian lockdown worst of both worlds: Govt flattened wrong curve
3Thousands of crores of rupees saved: India fills strategic reserves to full capacity with cheap crude oil