The Andhra Pradesh Electricity Regulatory Commission has asked the state government to consult them before according escrow cover to IPPs.
The state regulatory commission chairman GP Rao said they have written to the state government to consult the commission before escrow cover is accorded to IPPs in the state.
The commission's request to the state government gains importance as the state is in process of awarding escrow cover to the IPPs and is yet to decide on the number of projects as well as the manner in which the escrow is to be awarded. Even though the crisis resolution group under the Union power ministry has got an estimate of around 2500mw of escrowable capacity for the state, APTRANSCO_the state owned transmission and distribution company_is yet to finalise the projects which will be awarded escrow.
Sources said as the regulatory commission is primarily responsible for power tariffs in the state, the commission can play a crucial role in determining the criteria for awarding escrow cover to projects in the state.
IPPs like the Hinduja-National Power promoted 1000mw Vishakapatnam power project are negotiating on a Rs150-200 crore escrow cover with the state government. The proposal involves assigning revenue circles around the Vishakapatnam area for the escrow. Apart from the Hinduja-National Power project, the escrow is crucial for projects such as the BPL promoted 500mw Ramagundam power project, the 250mw Jegurupadu power project , the 500mw Krishnapatnam power project and the 500mw Vemagiri power project. Apart from this, NTPC which is promoting the 1000mw Simhadri power project is also in talks with the state government for an escrow cover. AP has already provided escrow to projects like the 350mw Kondapally power project and has two IPPs (Spectrum and Jegurupadu-I) which have started generation.
AP has adopted a distinct double escrow structure in line with the unbundled SEB, whereby the revenues will flow from the distribution companies to the state owned transmission company and then to the generating company.
