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Home News Power Sector News APERC sets aside order to sell 20% IPP power to open market

APERC sets aside order to sell 20% IPP power to open market

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APERCIn a setback to the AP State Government and to the independent power producers (IPPs), the AP Electricity Regulatory Commission has set aside the government order allowing IPPs to sell 20 per cent of the power they generated in the open market to compensate for their losses. APERC issued the order after a public hearing on the amendment to the power purchase agreements in favour of the IPPs.

The IPPs proposed amendments to the Power Purchase Agreements entered into with the power distribution companies of the State (Discoms).

They wanted that should be allowed to sell 20 per cent of the power out of the total production to sell in the open market. A committee appointed by the government last year, under the chairmanship of present Chief Minister K Rosaiah, when he was finance Minister, agreed upon these amendments. The government also issued an order no 135 stating that the amendment was made as a policy matter under 108 section of the Electricity Act of 2003.

However, the ERC rejected the government order stating that it could not be considered as a policy matter and also on account of the non-compliance of the government with Section 65 of the Electricity Act, 2003, which states that the government should bear the losses of the Discoms. It took the arguments put forward by objectors K Raghu, M Venugopala Rao and Thimma Reddy in to consideration.

Source - Indian Express

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