+
Cabinet Approval Required For Power Purchase And Supply Agreements
POWER & RENEWABLE ENERGY

Cabinet Approval Required For Power Purchase And Supply Agreements

The state will require cabinet approval before executing power purchase agreements (PPA) and power supply agreements (PSA).

The MP Power Management Company (PMCL) board recently decided that such agreements will proceed only after cabinet clearance and that implementation of board decisions will follow approvals from the energy minister and the chief minister.

Officials said the policy was amended because long term and mid term PPAs had imposed a significant financial burden on the state under the old system, where power was contracted despite lack of immediate necessity, and the cabinet will now scrutinise each proposed agreement to assess benefit and fiscal impact.

The government has made provision that the finance department must give approval in cases with budgetary implications so as to avoid creating contractual liabilities that could strain the state exchequer.

The government has received proposals for energy projects including biomass generation, solar battery storage systems, pump hydro storage and nuclear power, and each will be evaluated on technical and fiscal grounds with assessments considering current energy availability, projected demand and system flexibility.

The PMCL will coordinate technical appraisals and present findings to the energy department before matters are placed before the cabinet, and authorities indicated the revised approach seeks better oversight to ensure that any long term commitments are justified by demand and affordability.

The state will require cabinet approval before executing power purchase agreements (PPA) and power supply agreements (PSA). The MP Power Management Company (PMCL) board recently decided that such agreements will proceed only after cabinet clearance and that implementation of board decisions will follow approvals from the energy minister and the chief minister. Officials said the policy was amended because long term and mid term PPAs had imposed a significant financial burden on the state under the old system, where power was contracted despite lack of immediate necessity, and the cabinet will now scrutinise each proposed agreement to assess benefit and fiscal impact. The government has made provision that the finance department must give approval in cases with budgetary implications so as to avoid creating contractual liabilities that could strain the state exchequer. The government has received proposals for energy projects including biomass generation, solar battery storage systems, pump hydro storage and nuclear power, and each will be evaluated on technical and fiscal grounds with assessments considering current energy availability, projected demand and system flexibility. The PMCL will coordinate technical appraisals and present findings to the energy department before matters are placed before the cabinet, and authorities indicated the revised approach seeks better oversight to ensure that any long term commitments are justified by demand and affordability.

Related Stories

Gold Stories

Next Story
Products

Interio by Godrej launches modular workplace solutions

Interio by Godrej has launched Workscapes, a modular workplace solutions category designed to help organisations configure and adapt workspaces to changing requirements. The portfolio combines mobile and compatible furniture and support elements that can be rearranged across different work modes without changes to fixed layouts.Workscapes includes Collaboration Tables, Privacy Solutions, Mobile Markerboards and Space Dividers, Power Solutions, Storage and Support Elements, Meeting and Presentation Tools, and Seating Elements. The range is designed for focused work, collaboration, informal disc..

Next Story
Infrastructure Urban

CAFE-III Gives Auto Industry Investment Clarity

The government’s new Corporate Average Fuel Economy (CAFE-III) norms have provided the automobile industry with a clearer framework for technology investments, according to industry representatives. The framework seeks to balance environmental objectives with flexibility for manufacturers while encouraging the adoption of flex-fuel vehicles and biofuels. Society of Indian Automobile Manufacturers (SIAM) President Shenu Agarwal said the five-year framework would give automakers greater predictability to plan investments and accelerate innovation. He said the regulation established annual targ..

Next Story
Infrastructure Energy

Mines Ministry to Auction Two Offshore Mineral Blocks in Andaman Sea

The Ministry of Mines will launch an auction of two offshore mineral blocks in the Andaman Sea on Thursday, seeking to unlock India’s offshore mineral potential and strengthen long-term mineral resource security. The blocks will be offered under a composite licence, which permits exploration and development activities in accordance with the applicable regulatory framework. The ministry said the auction was intended to encourage systematic exploration, attract investment and promote the use of advanced technologies for offshore mineral exploration and development. The initiative is also aimed..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code