Your electricity bill may rise if you live in these states; Adani, Tata Power get SC relief

The three-member higher-power panel, formed by the Gujarat government, had recommended passing the burden of high fuel price to consumers, extention of the PPA and haircut to lenders to revive the stressed Adani and Tata Power projects.

By: FE Online  October 29, 2018 2:04 PM

The top court on Monday allowed the discoms and stressed power companies to seek amendment in purchasing power agreement (PPA)

With the Supreme Court giving the go-ahead to discoms and stressed power companies — Adani group and Tata Power — to appeal for amendment in power purchasing agreement (PPA) of Mundra projects, it is likely for the consumers to bear the brunt of higher power tariffs, should the Central Electricity Regulatory Commission (CPEC) agree to recommendations made by a high-powered panel.

The top court on Monday allowed the discoms and stressed power companies to seek amendment in purchasing power agreement (PPA), which may also include passing the burden of higher fuel prices to consumers. As per news agency PTI, if the CPEC implements the recommendations made by the panel, electricity prices will go up in Gujarat, Haryana, Maharashtra, Punjab and Rajasthan.

The Supreme Court, however, also said that the consumers can challenge the higher power tariff as per the law.

States to be impacted:

Gujarat

Haryana

Maharashtra

Punjab

Rajasthan

In Gujarat alone, the increased burden to consumers could be Rs 90,000 crore, PTI reported quoting a source familiar with the panel recommendations. The three-member higher-power panel, formed by the Gujarat government, had recommended passing the burden of high fuel price to consumers, extention of the PPA and haircut to lenders to revive the stressed power projects.

The committee has “submitted its recommendations earlier this month and the three power plants would get a combined benefit of Rs 1.29 lakh crore in the next 30 years if the recommendations are implemented”, the news agency reported.

The 4,000 MW Coastal Gujarat Power Limited of Tata Power, 4,620 MW at Mundra, Adani Power Mundra Limited and 1,200 MW Essar Power Gujarat Power Limited at Salaya were identified as stressed power projects. The companies have said to suffer due to higher coal prices following regulation by their main supplier Indonesia