The move is expected to provide flexibility to both procurers (mainly
The changes have been brought out by
In its proposal, the ministry has said that states with long-term PPAs with the interstate central generating stations, whose tariff is determined by the Commission, and which are due to expire in the future, can choose to give up the contracted power after the completion of the PPA tenure of 25 years.
Such a mechanism could be availed by the states procuring relatively costlier power from the central generating stations. Also, states looking to convert their long term PPA into shorter term agreements or look to buy power from exchanges to meet exigencies could also relinquish PPA after expiry of its tenure.
Under the proposed regulations, the first right of refusal would test with discoms meaning contracted power will be freed only with the consent of discoms. Also, discoms looking to end PPAs would serve at least three month notice to generators to help them prepare for the situation.
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