CERC may allow amendments to PPAs of power firms by Dec-end in Gujarat

With the Supreme Court asking the CERC to look into power purchase agreements signed by various states with private firms, floodgates for tariff revisions may open up

A Supreme Court order last month allowing the Gujarat government to approach the Central Electricity Regulatory Commission (CERC) for amendments to power purchase agreements (PPAs) perhaps for the first time will see a review of government contracts, primarily driven by concerns of the private sector. So far, governments, on several instances, have not honoured contract conditions and even forced private parties like Reliance Industries and Vedanta Cairn to withdraw in “public interest” from arbitration proceedings.

Though the issue in itself is not very complicated, there is a legal ping-pong which has been played out over the last six years and