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
Resources

Schindler named among Forbes’ World’s Best Employers 2026

Schindler has been named among Forbes’ World’s Best Employers 2026, a global ranking recognising companies for their workplace environments.Compiled by Forbes in partnership with Statista, the ranking is based on independent employee feedback, including whether employees would recommend their organisation to friends and family.The company said the recognition reflected its focus on creating a workplace where employees can develop their expertise and build careers. ..

Next Story
Infrastructure Urban

India needs an export-execution mindset: Vishesh Jain

Interview with Vishesh Jain, Founder & CEO, EximpleWhat gaps in India’s global trade ecosystem led you to build Eximple, and what problem did you see businesses struggling with most?Eximple came out of a problem that all three founders had seen from different choke points in the trade ecosystem. India has millions of MSMEs and manufacturers, and many of them can make products that are genuinely competitive on quality. Yet only a small fraction is able to build meaningful international businesses. In our experience, the gap is usually not manufacturing capability; it is the ability to exe..

Next Story
Building Material

Nuvoco reports 13.5% revenue growth in Q2 FY27

Nuvoco Vistas Corp. Ltd. reported consolidated revenue of Rs 27.9 billion for Q2 FY27, up 13.5% year on year. Cement sales volume rose 9% to 4.7 million tonnes (MMT), while EBITDA increased 11% to Rs 4.11 billion.The company said it began its cement operations in 2014 with a 2.3 MMT per annum (MMTPA) operation at Nimbol. It now aims to reach 35 MMTPA of cement capacity by FY28, nearly 15 times its initial capacity. Its portfolio spans cement, ready-mix concrete and modern building materials.On sustainability and cost efficiency, Nuvoco partnered with CleanMax for a 46.4 MW wind-solar hybrid re..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code