Center To Invoke the Electricity Act to Stall Jagan?

Things seem to be not going in favor of Chief Minister YS Jagan Mohan Reddy who is adamant about reviewing the Power Purchase Agreements (PPAs) signed during Chandrababu Naidu’s Government. Center which has been opposing the move since the start has now decided to invoke the Electricity Act to protect investor interest in Andhra Pradesh.

This is to ensure that the Government does not default on payments to clean energy developers. The Centre has directed Power System Operation Corp. Ltd (Posoco), which oversees India’s electricity load management functions, to see if Andhra Pradesh is backing down on electricity procurement because of grid safety, and has asked it to prepare a report on this.

In case of the reasons other than grid safety, the government has to pay for the power contracted for according to the PPA. Under these circumstances, the Government will have to start taking Power and pay money or pay money despite not using the Power.

As of now, Andhra Pradesh Government has given Oral Instructions to the Producers of Wind and Solar Power to stop production as they are no longer interested in purchasing power as per the old PPAs.