Gujarat Exclusive > Gujarat news > Guj govt cancels order that allowed power firms to charge higher tariffs

Guj govt cancels order that allowed power firms to charge higher tariffs

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The Gujarat government has cancelled its earlier order allowing higher tariff for power companies like Tata Power, Adani Power and Essar Power in the state. The 2018 government notification of the state had allowed the three companies to charge higher tariffs by amending the Power Purchase Agreements (PPAs). The three companies have a PPA with the state for long term power supply of upto 4600 MW for more than two decades.

The decision to cancel the same was taken in a recent cabinet meeting.  Media reports said the GR has been cancelled as coal prices have dropped and the decision was taken in public interest.

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The government had in 2018 allowed the three companies to increase the tariffs following a recommendation of a high-power committee formed to look into the matter. The three had made a representation that changes in law in Indonesia, where they sourced the coal for their coal-based power plants, had shot up their import cost.

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Tata Power operates a 4,000-MW power plant and Adani a 4,620-MW plant at Mundra in Kutch while Essar Power has a 1,320-MW plant at Salaya in Jamnagar.  Gujarat Urja Vikas Nigam Ltd (GUVNL) is the main power procurer from the three plants.