Power Update

Power Ministry to amend law to make obligations under PPAs & RPOs statutory binding: RK Singh

The government will soon amend the law making obligations under power purchase agreement (PPA) statutory binding thereby ensuring that all discoms have PPAs to cover 100 per cent requirement and it has convened a meeting of energy ministers of all states on November 10-11 in this regard, Union Power Minister, R.K. Singh said at an ASSOCHAM event held in New Delhi.

“I have called a meeting of energy ministers of all states on November 10-11, I will tell them that I am going to make obligations under PPAs statutory binding, that all discoms must have PPAs to cover 100 per cent of requirement and that there will be penalties for not paying electricity bills on time,” said Singh while inaugurating an ASSOCHAM Global Investors’ India Forum.

The Union Minister also said that he will tell all state energy ministers that there has to be a limit to cross-subsidisation in tariff to make the industry competitive enough.

“The second target that I will tell them is that if you want to give subsidy to any sector, you do it through Direct Benefit Transfer (DBT) so that efficiencies and inefficiencies of discoms are clear,” said Singh.
Highlighting that he has a very clear roadmap for reforms in the power sector, Singh said that Government will make it certain that payment of electricity bills are made on time by going for smart metering and pre-paid metering.

“I am also going to provide in the law penalties if power bills are not paid promptly and the amended law will also provide that the RPOs (renewable purchase obligations) will be obligatory, it will be a statutorily legal compulsion because we are not going to go back on our commitments made to the world and international community that about 30 per cent of our power will be from green sources of energy,” he said.

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