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Centre steps in to broker peace between Gujarat, wind power projects developers

Twesh Mishra New Delhi | Updated on January 01, 2019 Published on January 01, 2019

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‘State not allotting land for projects awarded by Central agencies’

The Centre has stepped in to resolve the dispute between wind power project developers and the Gujarat State government over land allocation.

Project developers have alleged that the State is not leasing land for wind projects auctioned by central agencies such as the Solar Energy Corporation of India (SECI). The developers also allege that the State sought an assured supply of power to the State power distribution company (Discom) in return for allocation of land for the projects.

“There is no such impasse. We are in talks with the Gujarat government to ensure a resolution of this issue,” a top official in the Ministry of New and Renewable Energy told BusinessLine.

“If the Gujarat government’s request is acceded to, it will set a dangerous precedent. While the Gujarat Discom does not delay payments, other States do. If they follow suit then it will be difficult for the wind power companies to continue at the same bid levels as the risk for each project goes up,” an official at a wind power project developer said.

“It is also a breach of contract, because under the SECI auction, the wind power generator sells power to PTC India. This allows us an off-take assurance and poses a lower risk,” the official added.

Projects in trouble

The dispute has jeopardised 2,000 MW of wind-based power generation projects expected to come up in Gujarat. These projects have been won by Inox Wind, Mytrah Energy, ReNew Power, Alfanar Sprng Energy, Green Infra Wind Energy, BPL Energy, Torrent Power and Adani group companies.

A double-whammy for these developers is the impending penalty they face for delays in financial closure of these projects. The companies face a penalty of ₹10,000 per day per MW from January 3, which SECI can levy for a delay, according to company officials.

Published on January 01, 2019
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