PPA renegotiation, cancellation may impact investment in clean energy: Icra

At the time of bidding, the benchmark regulated tariff for the tender was Rs 9.33 per unit

The recent attempts by state-owned distribution utilities (discoms) in states like Andhra Pradesh, Karnataka and Uttar Pradesh to renegotiate or cancel signed power purchase agreements (PPAs) with the wind and solar power developers are likely to have an adverse impact on the renewable energy sector. 

If implemented, this would also impact the credit profile of the independent power producers (IPPs) and investment interest from the private sector in this sector.

Sabyasachi Majumdar, senior vice-president and group head, ICRA Ratings says, “Given the circumstances, significant uncertainty exists for wind-based IPPs, which has recently signed PPAs based on feed-in tariffs. The same