APTEL gives relief to 3 Andhra firms

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Published: August 1, 2019 1:14:51 AM

By coercive action, it means cancellation, termination or deemed termination of power purchase agreements signed with these firms.

The controversy relates to a scheme for procurement of solar power of 750 MW each by NTPC and Solar Energy Corporation India on a long-term basis.

In a setback to the Andhra Pradesh government, the Appellate Tribunal for Electricity (APTEL), has asked the electricity distribution companies (discoms) owned by the Andhra Pradesh government and its electricity regulatory commission not to initiate any precipitative or coercive action against a group of firms including Ayana Kadapa Renewable Power, Sprng Soura Kiran Vidyut, Sprng Agnitra, SB Energy Seven and SB Energy Solar.

By coercive action, it means cancellation, termination or deemed termination of power purchase agreements signed with these firms. The controversy relates to a scheme for procurement of solar power of 750 MW each by NTPC and Solar Energy Corporation India on a long-term basis. In response to bids invitation, successful bidders, which include the petitioners, seem to have invested substantial amounts by paying to Solar Park Corporations, which is the state implementing agency.

“The parties agree that in the event the order of adoption of tariff, trading margin and agreements for procurement of power, as mentioned above, is not given by the Andhra Pradesh Electricity Regulatory Commission within the time specified above, this agreement as well as the power sale agreement shall stand cancelled and terminated with no liability of either party to the other or vis-a-vis AP discom(s), unless the parties mutually agree to extend the time for fulfilling the conditions precedent. In terms of agreement, discoms concerned should approach the state commission for adopting tariff, trading margin and approval for procuring contracted capacity,’’ the order said.

The commission is yet to determine the tariff. The issue has been lying with it since February 2018. The next date of listing is on August 7.

It may be recalled that Andhra Pradesh discoms terminated 21 PPAs, involving 776 MW of wind power capacity, signed between Axis Energy, a wind power company, and the discoms on the ground that they could do so since tariffs are yet to be determined.

gIn view of the precarious financial position of AP discoms and the consequent inability to bear the additional financial burden involved in purchasing power from 21 wind developers, discoms had decided to withdraw the PPAs,” APSPDCL said in its memo.

After hearing the submissions of counsels representing the petitioners and the intermediaries – NTPC and SECI, so also going through the relevant articles of PSA and PPA referred to above, we are of the opinion that there is genuine apprehension so far as the petitioner is concerned,’’ the order said.

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