The Union Ministry of Power (MoP) has approved the Andhra Pradesh government’s request to surrender 125 MW coal power that was allocated to AP Discoms from NTPC.
“The decision of MoP will benefit Discoms which could save ₹191.6 crore per annum on fixed costs,” AP Energy Secretary Srikant Nagulapalli said in a statement.
With spot purchasing of power at an average price of ₹1.63 to ₹2.80 per unit during March and April months, the power utilities reduced financial burden on Discoms. The government also saved around ₹180 crore in coal purchasing tenders.
In a letter addressed to Central Electricity Authority (CEA) on October 13, the Power Ministry mentioned that it was decided to revert the 125 MW coal power keeping in view the request from AP government. The power was allocated to AP Discoms on July 5, 2017 from coal based stations of NTPC for bundling with solar power under National Solar Mission.
Following the communication from CEA, the energy department welcomed the Power Ministry’s decision and stated that it would help to the efforts of AP government to minimise power procuring costs and reduce unwanted financial burden on Discoms.
Cutting procuring costs
The AP government is exploring ways to reduce power procuring costs and giving high priority for cost effective power. The measures being taken by power utilities for the last one year to revive and strengthen utilities, reduce unnecessary expenditure by procuring power at cheaper rates are yielding encouraging results.
The utilities have also decided to intensify the efforts towards fulfilling the objective of the government which wants to make the State as role model for cheap power.
“Apart from providing 24x7 power without interruptions, the focus is on ensuring cheap power on our agenda. This will benefit consumers in the State and boost industrial and economic development,” the Secretary said.