Punjab has become the most recent state to sign renewable energy contracts, requesting lower pricing from suppliers ahead of elections early next year.
According to reports, the Punjab Energy Development Agency (PEDA) met with almost 4-5 firms on Friday to consider supplying the province with 1,000 megawatts of inexperienced energy. Adani Power, Azure Power, and Acme Solar are some of the companies that provide the state with inexperienced electrical energy.
“The topic of discussion was the state’s high renewable energy costs and what efforts may be taken to lower the rates. “State officials suggested the prospect of a tariff drop for power purchase agreements signed previously” during the discussion, according to a source familiar with the situation.
According to a state official, the PPAs were signed as early as 2013-14 for around Rs 7 per unit, although current energy costs are far lower. In a public sale in Gujarat last December, solar energy tariffs in India reached an all-time low of Rs 1.99 per unit.
Any attempt by state authorities to reduce the tariff will likely violate the Electricity Act and the terms of the facility purchase agreement, according to Aditya Ok Singh, Associate Partner, Link Legal, and the state has no role to play in this area.
“When the government changes, it brings or strives to bring numerous changes in the way the administration functions. They may also seek to proceed down a road that is prohibited by law. There are whispers in the corridor that the Punjab government is considering introducing legislation to lower the tariffs approved by electrical regulatory commissions,” he said.
On Saturday, Punjab Chief Minister Charanjit Singh Channi approved a request to end the facility buyout agreement with the 540-MW GVK Goindwal Sahib plant. Arvind Kejriwal, the leader of the Aam Aadmi Party, pledged free electrical energy worth up to 300 items to each family if his party is elected to power earlier this year, whereas Punjab Energy Distribution Company sought low-cost solar energy developers last year, claiming a financial crunch.
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