Power Play: Govt may not allow BSES to exit PPA with NTPC

Even though the Central Electricity Regulatory Commission (CERC) has allowed BSES to walk out of a power purchase agreement (PPA) with NTPC’s Dadri-I thermal plant, giving other discoms in the country hope that they could also exit costly PPAs with the state-run producer, the Union power ministry may come to the aid of the CPSE. Sources said the ministry would take the stand that old PPAs could be revoked only en masse, rather than one at a time.

The right to allocate or de-allocate power from plants owned by CPSEs lies with the Central government, so the CERC order can take effect only with its consent. The Union power ministry issued guidelines in March on how discoms could exit PPAs from plants which have crossed 25 years of operations.