AP decries injustice: Y S Jaganmohan Reddy

Amaravati: The AP government has urged the Centre to constitute a high-level joint committee consisting of officials to find a long-term solution to the power purchase agreements (PPAs) issue.

In a letter to Union Minister for Power R K Singh, state Energy Minister B Srinivasa Reddy said since Andhra Pradesh has the highest share of renewable energy plants in the country, the Discoms have been facing severe financial crunch.

The integration of Variable Renewable Energy (VRE) with the grid is resulting in a burden of Rs 5000 crore per year. He said this has resulted in the power purchase costs of AP going up abnormally affecting the development of the state.

The letter said, "AP is penalized for being the first state in the country with the highest share of renewable energy at 25 per cent. AP consumes about 15,000 MU of VRE every year out of the 60,000 MU annual consumption.

The integration cost annually at Rs 3.55 per unit works up to Rs 5325 crore per annum. While AP is paying more than Rs 4.84 per unit of VRE purchased, the late entrants pay only Rs 2.4 per unit of VRE."

The VRE integration cost born by AP for every unit purchased is Rs 3.55 per unit. Which include adequacy cost of Rs 2.25 per unit, balancing cost of Rs 1.05 and Grid integration cost of Rs 0.25 per unit. Srinivasa Reddy said, "State government is engaged in a continuous dialogue between the VRE developers and the Discoms to resolve the crisis and for possible solution." The letter also urged the Centre to compensate AP for the additional cost thrust on it due to encouraging the RE generation.