Within 24 hours of the Union Power Ministry waiving transmission charges for states buying power from Adani Green and Azure Power, the YSRCP-led Andhra Pradesh government signed an agreement with central utility Solar Energy Corporation of India (SECI), giving the two companies a total of 12 GW ( GW) project
This waiver of ISTS (Inter-State Transmission System) charges is estimated to save 80 paisa (Rs 1,360 crore per year) per unit by encouraging the state to purchase power from the two projects. ISTS is charged when power is transferred from one state to another using the national grid.
The power ministry’s order dated November 30, 2021 essentially relaxed two conditions stipulated in an earlier order issued a week earlier on November 23. These two conditions were: (i) commissioning of the project before June 30, 2025, and (ii) electricity generated from the project falling under the state’s Renewable Energy Obligation (RPO). The RPO requires states to purchase a certain percentage of their total power from renewable sources.
The first 1,000 MW of Adani Green Power is expected to be operational only in April 2025, which remains after 2025, Andhra government sources said.
When contacted, an Adani Green spokesperson said, “The ISTS waiver was embedded by SECI in a construction-linked tender which was placed at par with other renewable energy tenders at the time… It is important to note that it is the DISCOM that benefits from the ISTS waiver, Not the project developer, who only receives a fixed tariff.” The spokesperson also said that the reason for the delay in commissioning was beyond the purview of the developer.
Adani Group chairman Gautam Adani, his nephew Sagar Adani and six others were indicted by the US Department of Justice for offering or paying $250 million in bribes to win lucrative power contracts from the state.
A day after the power ministry’s November 30, 2021, order, Andhra Pradesh signed a Power Sale Agreement (PSA) with SECI, the country’s nodal agency for renewable energy, on December 1, 2021.
“Had the charges not been waived, it would have cost 80 paisa over the Rs 2.49 per unit the state agreed to pay for electricity (it had to be wheeled in from Gujarat),” said an Andhra Pradesh official. Government.
As the state agreed to purchase 1,700 crore units of electricity from SECI, the power ministry’s intervention waived off Rs 1,360 crore for the government. Since the PSA was for 25 years, the waiver for this period translated into a cumulative amount of Rs 34,000 crore.
“One of the conditions laid down by Andhra Pradesh for buying power from SECI was that there should be no transmission charges. Once the transmission fee was waived forever, the government signed the agreement,” informed an Andhra Pradesh government official.
The new government led by TDP’s N Chandrababu Naidu is currently scrutinizing the PSA signed during the previous government under the YSR Congress party. This happened after the American court indicted Gautam Adani, Sagar Adani and 6 others.
The indictment alleged that out of the Rs 2,029 crore bribe, Rs 1,750 crore went to high-ranking officials of the Andhra Pradesh government. Terming these as “baseless” and rejected by the Adani Group,
On the delay in power delivery, an Adani Green spokesperson said, “…Scheduled Completion Date (SCOD) of renewable projects under SECI PPAs is limited by end-to-end evacuation availability and preparedness, which is planned and monitored by the Central Transmission Utility (CTUIL) and is beyond the purview and control of the developer. SECI or any other central nodal agency extends SCOD for these transmission delays, if the Central Transmission Unit (CTU) system is unavailable the project developers They cannot clear the electricity, which will cause the plants to stall.
Accordingly, due to delay in grid availability SECI has extended SCOD dates for our project to match the timeline coordination-meeting provided by CTUIL. We are fully committed to supply power under PPA from such new SCOD timeline.