ERC TO TAKE A CALL ON PPA CANCELLATION TOMORROW

LUCKNOW : The UP Electricity Regulatory Commission (UPERC) will take a call on Tuesday on the legality of the UP Power Corporation Ltd (UPPCL)’s decision to cancel the power purchase agreement (PPA) with the Bajaj Energy Ltd.

The UPPCL had in July unilaterally terminated around a seven-year-old power purchase agreement with Bajaj Energy Ltd, signed during the Mayawati regime for the purchase of a total 450 MW power, 90 MW each from its five thermal plants (set up within sugar mills), on the ground of higher power cost.

The Bajaj Energy challenged the decision in the high court pleading that same was against an old Supreme Court ruling. The high court, however, directed the company to approach the UPERC for relief.

Significantly, the UPPCL owes heavy dues to the Bajaj Energy Ltd for the purchase of power from its 1980 MW super critical Lalitpur thermal plant. “Total overdue outstanding to Bajaj Energy stands at around R 500 crore and to Lalitpur Power Generation at R1,500 crore,” Bajaj sources said.

They said bills from both companies to UPPCL had remained unpaid for the past several months making it difficult to pay salaries to 2000 employees.

“The UP Electricity Regulatory Commission will have to look into all these aspects as well while pronouncing its order that might have a bearing on the private investment in the state in general and in energy sector in particular,” sources said.