PPAs may force AP supply major chunk to Telangana post bifurcation

Power sector in Andhra Pradesh will continue to face the problem of shortage after bifurcation in spite of having surplus energy as a sizable chunk of it has to be supplied to Telangana in compliance with the slew of Power Purchase Agreements (PPA) entered by AP-GENCO with the distribution companies (DISCOMS).

The AP-GENCO may generate more power than what is required but it has to abide by the PPA even if the situation in Andhra Pradesh is grim. Most of the agreements are inked for more than 10 years and some for as long as 25 years and the problem is that they have to be honoured at any cost and consequences of deviation will be serious.

It was stipulated under Clause C (2) of 12th Schedule of A.P Reorganization Act that the ‘existing PPA with respective DISCOMS shall continue for both on-going projects and projects under construction’.

The Central and Northern Power Distribution Companies account for nearly 62 per cent of power requirement of the undivided State on any given day. Out of that, the share of CPDCL alone comprising the twin cities of Hyderabad and Secunderabad, Ranga Reddy and Medak districts is a whopping 47 per cent. SPDCL and EPDCL require nearly 23 and 15 per cent respectively.

Another issue is the condition that ‘power of the Central generating stations will be allotted in such ratio to the State of Telangana and the State of Andhra Pradesh based on actual energy consumption of last five years’. If this has to be taken as benchmark, a major share of the power will go to Telangana. It is because Hyderabad, being the capital city, has very high consumption due to the lowest duration of power cuts. This and other anomalies have to be rectified as soon as possible after the successor States of Andhra and Telangana come into existence for ensuring smooth transition, the official observed.