India : States producing wind energy asked to ensure regulatory nod for power purchase agreements

Wind energy tariffs set by regulators varied between Rs 4 and Rs 6 per khH but tumbled toRs 3.46 per kwH after the sole wind energy auction in February.

NEW DELHI: The Centre has asked wind energy-producing states to ensure regulatory approval of power purchase agreements(PPAs) signed when tariffs and equipment costs were higher, and use special powers under the Electricity Act to issue directions to autonomous regulators in public interest, if necessary.

Wind energy tariffs set by regulators varied between Rs 4 and Rs 6 per khH but tumbled toRs 3.46 per kwH after the sole wind energy auction in February. This prompted many states to seek lower tariffs from old projects, while several State Electricity Regulatory Commissions (SERCs) held back approval of PPAs already signed, raising serious concerns among wind energy developers and lenders.

The Ministry of New and Renewable Energy (MNRE) has written to seven states for invoking Section 108 of the Electricity Act, 2003.

“It has come to the notice of the MNRE that some SERCs are not according consent for wind power projects which were commissioned before March 31, and for which PPAs have already been signed,” said a letter from Bhanu Pratap Yadav, joint secretary, MNRE, to the principal secretaries (power) of Andhra Pradesh, Gujarat, Karnataka, Madhya Pradesh, Rajasthan and Tamil Nadu.

“This creates an atmosphere of uncertainty in the wind power sector and going back on contractual documents like PPAs may not be appropriate.” The August 21letter adds that the matter was discussed at a meeting chaired by NITI Aayog vice-chairman Arvind Panagariya and he too had “reiterated that the government should not go back on contractual agreements.”

“I request you (principal secretaries) to kindly take up the matter with the SERCs for grant of consent,” Yadav added.

 

Source : http://energy.economictimes.indiatimes.com/news/renewable/states-producing-wind-energy-asked-to-ensure-regulatory-nod-for-power-purchase-agreements/60184646

SMART GRID Bulletin October 2017


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