Revision of PPAs: High Court favours YSRCP govt

Amaravati: AP High Court on Tuesday ruled in favour of the YSRCP government in a case filed against the revision of power purchase agreements (PPAs). The High Court said that the state government has the power to review PPAs. The court also gave an interim order asking the state government to pay as per the revised rates instead of high tariff mentioned in the PPAs. The High Court has also announced setting aside the old GO. The High Court has justified the argument made by the YSRCP government, which prefers going to the Andhra Pradesh Electricity Regulatory Commission (APERC) for review of the PPAs.

The YSRCP government has received a fresh breather from the High Court as it allowed the state to pay Rs2.43-2.44 per unit as an interim payment. If needed, the state government is also allowed to stop power generation by serving a notice.

AP Chief Minister YS Jagan Mohan Reddy found fault with the PPAs, which demand higher tariff from the state government. This higher demand comes at a time when power and solar power tariff significantly fell. Jagan presented the court with proofs of additional burden to the tune of Rs 26,000 cr on the state government. Also, he informed the Assembly about the extra load on the exchequer in the form of higher PPAs.

The Andhra Pradesh High Court has ruled out the case filed by the power generating companies challenging the YSRCP government’s decision to review the PPAs. The High Court has further directed the state government and power companies to present their arguments before the APERC. High Court also stated that it couldn’t confirm the decisions taken by APERC. It further asked the regulatory commission to resolve the issue within six months.

“Without the requirement, the previous government made PPAs with higher tariff. This would benefit private power generating companies. The higher tariff is causing an additional burden of Rs 2,766 crore annually on the state government. We have decided to review PPAs and lower the tariff to pass on the benefit to the consumers,” said Jagan Mohan.

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