Why states are changing their mind on power tariff

Move by many states after signing PPAs will dent their credibility among investors: Industry players

Jyoti Mukul & Shreya Jai  |  New Delhi 

If low tariff was behind the financial stress of mega power projects in the past, high tariff is bothering them now. Many power producers are staring at uncertainty, as states renege on contracts to keep costly power out of their purchase list.   Until recently, the states were happy to buy power at tariffs decided by competitive bidding that came into effect in January 2011. But now they think the tariffs are too high, especially for renewable energy.   In Uttar Pradesh, the newly-elected Bharatiya Janata Party government has cancelled power purchase agreements (PPAs) with ...

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