Andhra Pradesh saves Rs 2,350 cr in power purchase in last two years

25 May 2021 CW Team

In the last two years, 2019-20 and 2020-21, Andhra Pradesh has saved approximately Rs 2,350 crore by purchasing electricity in spot markets at cost-effective prices.

The power utilities purchased 3,393 million units (MU) from the open market at lower prices in 2019-20 and 8,890 MU in 2020-21.

The average procurement cost, including transmission costs, was Rs 3.12 per unit, compared to the approved weighted average procurement cost of Rs 4.55/unit.

In addition to relying on spot market power purchases, state power utilities in India used artificial intelligence and machine learning for the first time to deploy a day-ahead electricity forecasting model. Every 15 minutes, this could forecast the next day's electricity consumption. This would allow for better decisions on electricity demand and supply, grid management, and lowering power purchase costs.

The state government persuaded the Ministry of Power to relinquish the 625 MW thermal power, allowing the AP discoms to reduce their financial burden by Rs 1,007 crore.

In the past, the central power grid collected central transmission utility point of connection charges from discoms based on anticipated usage on a quarterly basis. As a result, utilities were required to pay higher charges to the central grid.

In response to the AP energy department's protest, the CERC changed the methodology, resulting in Rs 350 crore in savings over the last two years.

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Also read: Govt urges electricity regulators to issue tariff orders on time

Also read: Liquidity infusion for discoms: Overdues fall Rs 15k cr in March

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