As more states take the route of revision of tariffs for renewable energy projects as recent bids have gone ultra low, the sector could see a major shakeup with close to 7 GW under pressure. Rating agency CRISIL expects Rs 48,000 crore worth of project capacity under threat.
Many discoms have openly voiced their reservations in honouring the power purchase agreements (PPAs). These include Andhra Pradesh (~1.1 GW), Gujarat (~250 MW), Karnataka (~900 MW) and Tamil Nadu (500 MW), which had signed PPAs/LoIs at feed-in tariffs or at much higher than the recent bid tariffs.
“Aggressive bidding for renewable energy capacities appears to have started recoiling on the industry discoms call for renegotiation of PPAs which they signed in past at higher tariffs. Also, discoms are known to use measures such as grid curtailment and payment delays to compel developers to offer discounts,” CRISIL said in its latest report. Read More…
Credit By: Business Standard