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Home News Power Sector News MERC suggests long term PPA for utilities for reducing costs

MERC suggests long term PPA for utilities for reducing costs

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MumbaiMERC suggested the Maharashtra government should ask Reliance Infra, Maharashtra State Electricity Board and BEST to immediately sign a long-term power purchase agreement (PPA) with power producers outside the state so that the agencies do not have to buy extra power at a high cost whenever there is a shortfall in supply. The steep price that the agencies pay to buy that power is ultimately passed on to you and, if there is a long-term agreement to procure power, the cost will automatically come down.

The government has referred the recommendation to the three agencies and all of them have been quick to respond; they have submitted their applications to the MERC for buying around 4,000 MW of power together on a long-term basis and the MERC has approved this plea so that they can float bids for the purpose.

The long-term agreement will bring power to the state at a cheaper price (of not more than Rs 7 per unit) than the current cost of procuring extra power on an emergency basis (which is around Rs 14 per unit).

The second MERC suggestion has been routed directly to 27 lakh Reliance consumers in suburban Mumbai. You can register your complaint on the MERC website if you suspect your Chinese meter to be running extra fast; the MERC will then go for a random check of meters by a third party (the Indian Design for Electrical Measuring Instrument).

Source- Times of India


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