The Multi National Group Hindujas lost a big case in Andhra Pradesh Electricity Regulatory Commission related to 1000 MW Thermal Merchant Power Plant located in Visakhapatnam.
On Wednesday, APERC has dismissed the petition of Hinduja National Power Corporation limited which claimed an Interim Tariff for its Visakhapatnam Thermal Plant.
With decision of APERC, the State Power Utilities got relief of higher payment of Rs 25,000 crore approximately spread over 30 years. Indirectly, the power consumers of Andhra were saved from tariff increase about Rs 25,000 crore. CM Chandrababu Naidu has already approved the proposal of State’s Energy Department and Power Utilities for not procuring higher cost power from HNPCl for 2018-19 Tariff Year. Following, the Discoms submitted Tariff Proposal before APERC without including 1000 MW of HNPCl in their power purchases for 2018-19.
With this decision, the discoms could not proposed tariff increase as promised by the CM to public at the time Nandyal bypoll and Kakinada Muncipal elections. AP Transco on behalf of AP Power Distribution Companies opposed very strongly against HNPCl claims. HNPCl claimed Rs 2.60 per unit under fixed cost. It has shown higher variable cost against International Coal and washed coal usage.
With different types loads in Capital Costs and Variable Costs, per unit cost of HNPCl has almost crossing Rs 5.50, which was not acceptable to State Power Utilities in any stage. As HNPCl claims were higher side and against public interest, AP Transco and Discoms advised in many number of negotiations to reduce the Capital and Variable Costs loaded. But, HNPCl has filed Petition before APERC for Interim Tariff Order for 30 years of Power Purchase Agreement.
At present, AP Transco is purchasing private power in power exchanges at Rs 3.60 per unit from open markets.
When compared Open Market power purchase cost with HNPCl power purchase, the consumers or utilities have to pay Rs 2.0 of higher side per unit, which comes around Rs 50,000 crore for 30 years of PPA. Even if, Rs 1.0 variation would also cost Rs 25,000 crore for 30 years.