Delhi's BSES discoms start process to exit power purchase agreements with 7 power plants

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New Delhi, Jul 15 (PTI) BSES electricity distribution companies in Delhi have initiated the process of exiting power purchase agreements with seven power plants that have completed 25 years of operation or nearing it, sources said on Thursday.

The move comes in the wake of the Central Electricity Regulatory Authority allowing BSES Rajdhani Power Limited (BRPL) and BSES Yamuna Power Limited (BYPL) to exit power purchase agreements with NTPC Dadri-1 power plant which completed 25 years of service on November 30 last year.

'Apart from Dadri I, Reliance Infrastructure-led BSES discoms have initiated the process with the Delhi Electricity Regulatory Commission for exiting the remaining power plants in this category. Five of these plants -- Unchahar-1, Farakka, Dadri 1, Auriya gas, and Anta -- have already completed 25 years,' a discom source said.

Of the remaining two plants, Kahakgao-I will complete 25 years of service in August this year and Dadri gas in April 2022, sources said.

BSES discoms -- BRPL and BYPL -- supply power to around 45 lakh consumers in the national capital.

'The seven power stations are supplying expensive power, above Rs 6 per unit, to the BSES discoms. These power plants supply around 830 MW power to BSES,' the source said.

Replacing this 'expensive' power with substantially cheaper green power, available at around Rs 2.50 per unit, will lead to savings of around Rs 800 crore per year for the Delhi consumers that totals Rs 20,000 crore over a period of 25 years, they said.

This substantial difference in the prices of power will help in neutralizing cost increase by absorbing the impact of inflation and other factors, including the cost of coal and gas, and will also ease the pressure on future tariff hikes, sources claimed.

Besides, the savings may also help in creating headroom for recovery of the past revenue gap (regulatory assets). Due to non-cost reflective tariffs, revenue gaps (regulatory assets) of the Delhi discoms have reached Rs 51,646 crore as of March 31, 2020, they added. PTI MG VIT NSD NSD

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