A beleaguered Kerala State Electricity Board (KSEB) has sought the Kerala State Electricity Regulatory Commission’s nod to continue buying power from three generation companies under ‘‘unapproved’‘ purchase contracts to fend off a power crisis.
Citing ‘‘severe financial crisis”, the KSEB approached the commission for permission to procure power under four Design, Build, Finance, Own and Operate (DBFOO) contracts with Jhabua Power Ltd, Jindal India Thermal Power Ltd., and Jindal Power Ltd. till alternative supply arrangements are in place.
The KSEB indicates that, minus the supply from the DBFOO contracts, Kerala could face a shortage of ‘‘around 500 to 1500 MW’‘ between August 2023 and May 2024.
The commission will hear a KSEB petition in this regard on Monday.
In May this year, the commission had rejected the four long-term power purchase agreements (PPA) worth 465 MW with the three companies citing irregularities. It, however, allowed an ‘‘interim arrangement’‘ whereby the KSEB could continue scheduling power under these ‘‘unapproved’‘ PPAs for 75 days. This was done to avert a power shortage and give the KSEB time to arrange alternative supply through medium-term contracts.
The medium-term contracts, for 500 MW round-the-clock power for five years, are not yet in place. Even if they were, supply would begin only by January 1, 2024, the KSEB indicates in its petition.
The 75-day interim arrangement permitted by the commission ends on Monday, August 21, which has prompted the KSEB to file its plea.
The weak southwest monsoon has severely impacted storage levels in hydel reservoirs managed by the KSEB. Due to poor inflows, the combined storage in the reservoirs is stagnant at 37% of the capacity.
Further, the KSEB observes in its petition that ‘‘the availability of power from the Central generating stations has drastically reduced due to coal shortage issues, forced outage of units, and wind energy availability has also come down’‘. It further adds that ‘‘the availability of power from the market even at higher rates is difficult”.
To maintain uninterrupted supply in this scenario, the KSEB is reportedly spending around ₹10 crore daily on power purchases. In its petition, the KSEB notes that the PPA rates with the DBFOO companies — ranging between ₹3.99 and ₹4.68 per unit — are way lower than the present market rates.
Besides, in the case of the DBFOO contracts, payments need to be made only within 30 days. In the case of energy exchanges, which the KSEB depends on for meeting the daily demand, payments have to be made in advance.
