New Delhi Feb 23: Adani Power Sunday welcomed the Central Electricity Regulatory Commission (CERC) order granting nearly Rs.830 crore in compensation, saying the move will help sustain operations at its Mundra project in Gujarat.
“Despite facing huge financial losses, Mundra power plant has been supplying power to Gujarat and Haryana. This order will facilitate in sustaining operations at Mundra and enable us to continue honouring PPA commitments,” Adani Power said in a statement.
The compensation is for losses incurred by the project owing to higher costs of imported Indonesian coal.
“When the power sector is facing a multitude of issues, this order shall go a long way in reviving investor confidence and will provide sustainable energy security for the country,” the statement added.
CERC has ordered Gujarat to pay Rs.420.24 crore, while Haryana has to pay Rs.409.51 crore as compensation from the commissioning date till March 31, 2013.
The order pertains to one power purchase agreement with Gujarat for 1,000 MW and two PPAs with Haryana utilities – Uttar Haryana Bijli Vidyut Nigam and Dakshin Haryana Bijli Vidyut Nigam.
The regulator has also allowed compensatory tariff from April 1, 2013 on the basis of a formula.
The CERC had Friday granted a compensation order for Tata Power’s 4,000-MW Mundra ultra mega power project (UMPP) in Gujarat to make up for the increase in cost of imported coal.
In 2011, Tata Power, along with Adani Power, had petitioned CERC for a tariff hike after the government in Indonesia hiked the price of coal.