AP High Court strikes down Jagan Govt’s GO on PPAs

The Andhra Pradesh High Court directed the renewable power generating firms, which are opposing the State government’s decision to renegotiate power purchase agreements (PPAs), to approach the Andhra Pradesh Electricity Regulatory Commission (APERC) to raise their objections. The court directed the regulatory commission to resolve the matter in six months.
After reserving the order last week, the court directed the State to pay Rs 2.43 to Rs 2.44 per unit of solar and wind power as an interim tariff until APERC disposes of the matter. It may be recalled that the wind and solar generators moved the court against the government’s order to renegotiate renewable PPAs, contending that higher tariff was burdening the State exchequer.
During the hearings, which began in July and continued till last week, the power generators prayed that the government order be suspended. While the court, on July 25 gave an interim stay on the order, it ignored the same on Tuesday. 
While noting that a government could issue notices as per law, the court told the State to not curtail power without intimating the generators. Reacting to the court’s order, Energy Minister Balineni Srinivasa Reddy observed that renegotiation of PPAs would help in saving public money and bail out the debt-ridden power utilities.
“As per our request, the High Court handed over PPA price review matter to the APERC. Our efforts are meant for the public good. Chief Minister YS Jaganmohan Reddy is trying his best to set right the electricity department that has lost its credibility because of the previous government,” he said, adding that liabilities of the discoms mounted to Rs. 20,000 crore due to gross mismanagement by the previous dispensation.
The minister, however, clarified that the review of PPAs would only be done in cases where pacts were signed with malafide intentions. “Some companies have syndicated and made pacts at higher prices. The PPA price review will be done only in such cases,” he said, according to a statement released by the Chief Minister’s Office.

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