Wind energy fans power-short Gujarat as Adani and Essar switch off

At a time when Adani and Essar have discontinued supply of power to the tune of 3,000 Mw in Gujarat, the state has found respite through wind power generation. 

According to state government and industry sources, wind power generation has touched an almost all-time high of 2,800 Mw. The high renewable energy availability comes as a respite amid Adani and Essar discontinuing  supply to Gujarat Urja Vikas Nigam (GUVN), the state power distribution entity.

Of the state's three independent power producers (IPPs) which are struggling, only the Tata's CGPL has been able to resume supply to GUVNL, thereby honouring its power purchase agreement (PPA). Adani and Essar, with a combined 3,000 Mw in PPAs, have been supplying almost zilch. 

The state government has made good the balance amount it needs — peak demand has crossed 16,000 Mw — through the open market. That is, through the Indian Energy Exchange (IEX), at prices higher than the existing PPAs.

“For the past few months, we have seen a lot of buying activity from Gujarat in the spot market,” said an analyst from a rating agency, who did not wish to identified.

Government and industry sources say Gujarat is drawing 2,500-2,800 Mw from IEX and other sources. 

“The government has directed GUVN to purchase power at any cost and from anywhere to avoid power cuts in Gujarat,” said energy and regulatory expert K K Bajaj.

With companies not honouring the PPAs, Gujarat's power purchase from IEX has risen 230 per cent in two years. 

GUVN says it is waiting till September before taking punitive action against the IPPs for not fulfilling the PPA commitment. “Meantime, we have written to the IPPs, demanding they honour the PPAs," said a GUVN official, on condition of anonymity.