In a major relief to the public power utilities of Andhra Pradesh (A.P.), the Supreme Court on Friday upheld an order of the A.P. Electricity Regulatory Commission (APERC) that the term ‘fuel’ used in the Power Purchase Agreements (PPA) signed by four gas-based power plants (Independent Power Producers-IPP) in the State, does not automatically entitle them to generate power with Regasified Liquified Natural Gas (RLNG).
With this, the State utilities have been saved of the burden of forking out nearly ₹4,000 crore to the IPP.
The matter pertains to determining whether the term ‘fuel’ in the PPAs between the State power distribution companies and the IPP —GMR Vemagiri Power Generation Limited, Konaseema Gas Power Limited, GVK Power and Gauthami Power — was inclusive of RLNG, which is far more expensive and not domestically available and the apex court ruled in favour of the State power utilities.
