Hyderabad, October 16: Chief Minister K Rosaiah has rejected the demand for withdrawal of the controversial GO (No. 135) issued by the Energy Department facilitating the independent power producers (IPPs) to sell 20 per cent of the power generated by them in the open market.
He said there was no way the Government could withdraw the GO since it was bound by the Power Purchase Agreements (PPA) the APTransco had signed with the power utilities.
Addressing a news conference here on Thursday, Rosaiah clarified that the GO was issued formalising the decisions taken by the Cabinet in May 2008. “The decision will save about Rs 4,080 crore due to the four companies by the State Government for the last four years.
It will also relieve the Government from the compulsions of supplying alternative fuel like expensive naphtha in case of nonavailability of gas to the companies for power generation.” In its PPA with the IPPs, t h e Gove r nment agreed to provide naphtha as an alternative fuel in case of non-availability of gas. In lieu of not providing any fuel, the Government has to pay fixed charges of Rs 1,020 crore per annum. “The decision was taken in the best interest to save public money. Otherwise, we have to pay Rs 1,020 crore per annum to each of the four private companies towards fixed charges as per the PPA entered in 2003,” he said.
However, the Chief Minister stated that the Government decision will be implemented subject to the verdict of the AP Electricity Regulatory Commission (APERC). He also clarified that this will not stop the private power generation companies from claiming the fixed charges in future. “There is uncertainty over the supply of gas. Despite our best efforts, we are able to meet only 70 per cent of gas requirements of the IPPs,” he said.
–Agencies–