APERC Wants AP Reorganisation Act Amended

Express News Service
Hyderabad, April 15:

  The Andhra Pradesh Electricity Regulatory Commission (APERC) wanted the State government to see that some clarifications and amendments were needed for the AP Reorganisation Act-2014 for reorganising the power sector in the state. The ERC secretary dashed off a letter to the principal secretary Energy on Tuesday to this effect.
 The ERC also found fault with the government for not consulting the Commission when the T-Bill was in the draft stage.
 The ERC in its "advisory" to the government on Tuesday suggested six points to be taken into consideration by the government.
  "The advisory is to point out problems in the present schema of the Act and highlights the need for suitable clarifications/amendments in the Act if the power sector is to be seamlessly partitioned between AP and Telangana. The Commission was not consulted by the government when the T-Bill was in the draft stage. Accordingly, and in compliance with its obligation the ERC issues advisory to the State government in the matter of reorganisation and restructuring of the electricity industry in the state", ERC said.
   Allocation of power to Discoms: The Act stated that the Power Purchase Agreements (PPAs) with respective Discoms will continue. But, the ERC stated that the None of the PPAs, signed by generators with Discoms, allocate power to individual Discoms. The PPAs have been signed between Genco and all Discoms collectively. The power allocated to each Discom is nowhere mentioned in the respective PPA. The PPA only mentioned the total power to be delivered by Genco to all the Discoms collectively. Thus, the article 2 of section C in the Act as it stands now is imprecise and cannot attain the objective it seeks to achieve.

NEW ERC: The Electricity Regulatory Commission for the existing state of AP shall on the appointed day, be the Electricity Regulatory Commission for the residuary AP and a new Commission shall be created for Telangana state. Till the Telangana ERC is formed, the ERC for the residuary AP shall function as a joint regulatory commission for both the States.

CGS POWER: The ERC advised the State government that the Central Generation Stations power could be allocated by Ministry of power as per their existing norms. The Reorganisation Act does not contains provisions relating to restructuring and reorganisation, the provisions in the Act appear defuse and inadequate, the ERC said.

PURCHASE OF EXCESS POWER: On the purchase of excess power, the Reorganisation Act stated that for a period of then years, the successor state that has a deficit of electricity shall have the first right of refusal for the purchase of power from the other successor state. However, the ERC stated that this clause seeks to protect the interests of the deficit state facing a power shortage. However, this objective can not be effectively achieved since the price at which this has to be offered has not been mentioned here. Thus it is possible for a surplus state debilitate this right by making an offer to the deficit state at an unreasonable price, the ERC noted. The ERC suggested the government to revise the clause 7 in the AP Reorganisation Act to incorporate the maximum price at which this power must be offered by the selling surplus state to the purchasing deficit state.
HYDRO PLANTS: On the treatment of ownership of Hydro power projects, the Reorganisation Act stated that the hydro projects managed by APGENCO will be managed by the respective River Management Boards. ERC pointed out that the "authority" which manages the hydro projects was not defined in the Act and it should be defined and the percentage of the power allocated to the two states or four Discoms needs to be specified, the ERC stated.


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