BENGALURU: Clean energy now forms 50 per cent of Karnataka’s 30,000 megawatts (MW) of installed power capacity, and in the past few months, it has surpassed conventionally produced electricity in terms of fulfilling industry requirements.
This is good news for the environment, though it has come at a cost for the state. One reason power generation from renewable energy sources (solar, wind, biomass) has increased is high-priced, longterm contracts. Essentially, successive governments agreed to buy clean energy from producers at rates higher than what officials consider reasonable.
In power purchase agreements, or PPAs, governments signed off on rates ranging from Rs 8 to Rs 10 per unit of renewable energy. In comparison, thermal energy is priced at Rs 5.5 per unit and hydel power Rs 3.8 per unit.
Clean energy rates were later reduced for new contracts, but the government must pay the original price for agreements finalised earlier. These agreements have a priority clause, which requires the government to utilise clean energy first.
