‘Cabinet sub-committee willsubmit report on PPAs soon’

41 were signed with terms in favour of IPPs, says Buggana

Finance Minister Buggana Rajendranath Reddy said the Cabinet sub-committee that was appointed to probe the renewable Power Purchase Agreements (PPAs) signed during the TDP regime, would submit its report soon.

The issue was complex that needed to be studied thoroughly, Mr. Rajendranath REddy said, pointing out that 41 PPAs were entered just before the general elections in blatant violation of norms.

Giving an explanation on the action taken by the government in respect of the PPAs to Mantena Ramaraju and other TDP MLAs during question hour in the Assembly on Monday, he said the terms of the PPAs were heavily loaded in favour of the companies and the present government had no option but to review them to reduce the tremendous burden imposed by them (PPAs) on the consumers.

He maintained that the Central government did not completely bar the State government from reviewing the PPAs, what it did say was that the PPAs could be reopened only when there was tangible evidence of corruption.

The TDP government had clearly exceeded the Renewable Power Purchase Obligation stipulated by the Centre thereby entailed a massive expenditure on the already sick Discoms, he pointed out.

‘Discoms took a hit’

The Minister said the losses incurred by Discoms stood at a staggering to ₹29,000 crore largely due to the high-cost PPAs.

The YSR Congress (YSRC) government cleared dues amounting to ₹4,900 crore, thus it started cleaning up the mess.

Mr. Rajendranath Reddy observed that the Discoms were reluctant to sign the said PPAs, but to no avail as the then CM N. Chandrababu Naidu had prevailed on them.

The dues to AP-Genco and Independent Power Producers (IPPs) mounted from ₹3,910 crore in 2014-15 to ₹21,540 crore by the end of 2018-19.

Heated exchanges

Later, a heated debate ensued between Mr. Chandrababu Naidu and his party MLAs and those in the treasury benches when Speaker Thammineni Seetharam refused to allow Mr. Naidu to dwell into the details of PPAs after the Finance Minister and Energy Minister Balineni Srinivasa Reddy stated the government’s position.

The TDP MLAs demanded that the government answer why the Cabinet sub-committee did not take any action against those who violated norms related to PPAs if what the government said was true, and disclose reasons for the delay in submission of the findings of the expert committee.