In a strategic move towards promoting clean energy and fulfilling Punjab’s future power requirements, Chief Minister Bhagwant Singh Mann and his government have taken a significant step by entering into a Power Purchase Agreement (PPA) for 1200 MW with Sutlej Jal Vidyut Nigam, a subsidiary of the Bhakra Beas Management Board and a renowned player in the renewable energy sector.
Chief Minister Mann revealed the key points of the agreement
Chief Minister Mann revealed the key points of the agreement during a press interaction at Punjab Bhawan. The Punjab State Power Corporation Limited (PSPCL) had initiated a tender process for procuring power from solar projects both within Punjab and across the nation. Under the terms of the agreement, SJVN Green Energy Limited proposed an attractive rate of Rs 2.53 per unit for 1000 MW generated in Bikaner (Rajasthan) and Bhuj (Gujarat). Additionally, a rate of Rs 2.75 per unit was agreed upon for 200 MW of power generated in Hoshiarpur (Punjab).
An innovative approach was adopted to ensure transparency and maximize benefits for the state. The Swiss Challenge Method (SCM) was employed to invite counter bids, marking the first implementation of this method in such a context. Through skillful negotiation, the initial bidding rate of Rs 2.59 per unit was successfully brought down to Rs 2.53 per unit for the larger projects. Similarly, the rate for the 200 MW project, initially bid at Rs 2.79 per unit, was reduced to Rs 2.75 per unit, resulting in substantial cost savings.
Chief Minister Mann highlighted that this prudent negotiation has led to a substantial saving of Rs 431 crore for the state government. The projects are slated to commence soon, with the added benefit of avoiding transmission costs.
The Chief Minister took the opportunity to critique the practices of previous administrations, noting their tendency to sign agreements that disproportionately favored private entities and drained public funds. In stark contrast, the current PPA has been secured at a nominal cost, marking a significant milestone in terms of cost-effectiveness and responsible governance.
Furthermore, Chief Minister Mann underlined Punjab’s pioneering effort to become the first state to introduce a power banking policy. This innovative move is expected to turn Punjab into a power surplus state, with potential for far-reaching positive implications. The policy is aimed at ensuring the availability of affordable, consistent, and uninterrupted power to the general population, thereby sparking a transformative shift in the energy landscape.
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