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.

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.

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.

The Union Minister further said that Power Ministry will separate carriage and content which will happen in the next amendment and that would bring-in more competition in distribution which shall bring in more efficiency.

We have proposed to bring that in the amendments which we are contemplating in the Electricity Act, where we will deal with the issue of PPAs and RPOs, he elaborated.

On the hydro policy Singh said, So far as it is concerned, a draft was put up to me, I am seeing it, they are refining it and once it is ready, we will send it to the cabinet.

He said that he will try to get it passed in the Winter Session of Parliament.

He also said that power demand in India is going to grow because coverage is going to expand and is going to be universal. We are connecting all villages by this December though the target is for March.

Singh further said that green energy is going to gradually edge out fossil fuels primarily petroleum. He however said that it would require investments in technology, grid balancing, green corridors, in peaking power.

By and large we see electricity emerging as the primary source of energy as electric mobility is more efficient than mobility by petrol or diesel, the only thing required is the prices of the battery of storage systems to come down, said Singh.

He said that it will also require investments in storage systems and electric vehicles manufacturing. I had called a meeting of all vehicle manufacturers as well as storage systems and have asked them to start investing, because that is the future which I see.

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