Purchased electricity worth Rs 40,000 cr in 2 years: Guj govt to Assembly

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The Gujarat government on Thursday informed the Assembly that it has purchased electricity worth Rs 40,634 crore from different power generation firms in the last two years.

Responding to a set of questions raised by Congress MLAs, state energy minister Kanubhai Desai said Rs 20,898 crore was paid to 804 firms, mostly renewable energy projects, in 2022 while Rs 19,736 crore was paid in 2023 to 919 firms towards the purchase of electricity.

In 2022, the average cost was Rs 5.25 per unit while it was Rs 4.75 in 2023, he added.

Congress Legislature Party leader Amit Chavda and senior Congress MLA Shailesh Parmar confronted Desai over the issue and sought to know why private firms are given preference over state-run energy generation firms.

"The total installed capacity of the state government's power plants is 9,347 MW while the total installed capacity of three private entities - Adani, Essar and Tata - is 5,361 MW. Despite our capacity being more, we give preference to private firms," said Parmar.

Desai said the share of Adani Power and Tata Power was merely 6 per cent and 7 per cent, respectively, in the entire energy purchase basket of the Gujarat government.

He said the state government always takes care that electricity purchased from the private sector remains minimum.

"We buy electricity as per the merit order system set by the Central government. Merit is decided as per the cost of producing electricity. We buy from those whose energy cost is less, and that's why they are on top of merit order. We don't give any preference to anyone," said Desai.

He said coal-based thermal power plants of these companies are more cost effective in comparison to the state government's plants which are old.

"Gujarat's energy demand has reached 24,000 megawatt today while our own plants are capable of producing only 5,000 megawatt. That is the reason we have to buy power from private firms. Otherwise, we have to impose load shedding," said the minister.