Financial Daily from THE HINDU group of publications
Tuesday, Mar 12, 2002
Government - States
Industry & Economy - Power
PPA muddle stalls BPL project in AP
V. Rishi Kumar
HYDERABAD, March 11
THE progress of the 520 MW BPL power project planned at Ramagundam in Andhra Pradesh has been affected following the recent directive of Andhra Pradesh Electricity Regulatory Commission (APERC) with regard to its power purchase agreement (PPA).
The 2x260 MW thermal project's PPA was submitted to APERC, which directed Andhra Pradesh Transmission Corporation (APTransco) to renegotiate with the developer and submit the PPA.
APTransco held discussions with the representatives of BPL for implementation of APERC orders and sent its comments on the proposals made by BPL to the regulator for consent, according to Government sources.
BPL has requested Singareni Collieries Company Ltd for modifications in the coal supply agreement (CSA) so that the directive of APERC for raising the threshold level to 80 per cent can be implemented.
On whether the additional guarantee charges and capacity charges payable to Singareni Collieries by BPL can be borne by it, APTransco has said that it is not in a position to accommodate this additional burden.
With issues relating to coal supply agreement yet to be thrashed out, the progress of the power project, which had reached a crucial phase, has been affected.
The project received techno-economic clearance (TEC) from the Central Electricity Authority in 1997.
An amended and restored PPA was signed in January 1999. Based on this development, the Andhra Pradesh Government issued a State Government guarantee for the project.
CEA issued approval for final financial closure package in early 2001.
Based on this development, the company had commenced civil works at the site.
However, the APERC order has now introduced a new dimension which could delay or even affect the project's progress.
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