The battle between renewable energy companies’ and Andhra Pradesh is getting intense as the state has sought cancellation of 21 wind power purchase agreements with clients of Suzlon Energy and Axis Energy and is not letting the wind plants operate for most hours of day without giving any valid reason.
The cancellation is despite the high court staying a July 1 notification issued by the state and July 12 letters written to various developers seeking renegotiation of power tariffs from solar and wind power plants.
Andhra Pradesh South Power Distribution Co Ltd has filed a memo in the state electricity regulatory commission to withdraw the 21 wind PPAs. The PPAs though signed were not yet approved by the regulator.
“…in view of the precarious financial position of AP discoms and consequent inability to bear the additional financial burden involved in purchasing power from 21 wind developers, AP discoms have decided to withdraw the PPAs entered with various wind power projects cients of Suzlon and Axis Energy Ventures India Pvt Ltd. The APSPDCL further submits that since the PPAs are not yet approved, the same is not enforceable and the APSPDCL is at liberty to withdraw the same,” the memo to Andhra Pradesh Electricity Regulatory Commission said.
Wind power companies are also agitated as the state has been curtailing generation from the plants since three-four days. The developers are likely to take legal recourse against the back down citing it as harassment and violation the must-run status given to renewable plants. “The complete wind power generation is forced to back down in the morning and is restored to up to 50% by the evening, leading to huge generation losses,” said an executive.
The back down of solar and wind power generation attracts penalties under state’s electricity grid code which gives renewable energy projects must-run status. The Andhra Pradesh State Electricity Regulatory Commission can take suo motu action against the state load despatch centre, the grid managing agency, said the official.
According to people aware of the matter, the southern region load despatch centre had asked the state load despatch centre on Thursday to back down some of its power generation as the national grid frequency was high at 50.3 Hz around noon. The grid frequency is maintained at around 50 Hz, but it rises when interstate drawals of electricity decline.
At around 4.30 pm on Thursday, about 1,100 MW of wind power generation was restored and only 550-mw solar could be partly brought on-line as the sun had started setting in, said an official. “Solar was at its peak when the plants were asked to shut down,” he said.
Andhra Pradesh is in a legal battle with renewable energy developers as the state has asked them to reduce electricity tariffs. The newly formed YS Jagan Mohan Reddy government, in its July 1 notification, also sought to challenge its electricity regulator’s previous decision to award must-run status to renewable projects.
Renewable power plants have been awarded must-run status across the country to promote clean energy projects and facilitate their integration in the grid. Power supply by a state despatch centre is arranged in the order of their cost, starting with the lowest tariff. This process, called merit order despatch, is carried on till the demand of the state is met. However, power generated from renewables is not curtailed in any case.