|
|
|
Andhra's attempts to renegotiate PPAs to hamper renewable operators' cash flows
|
|
|
|
Top Stories |
|
|
|
|
SME Times News Bureau | 17 Jul, 2019
The Andhra Pradesh government's attempts to renegotiate its agreements
to purchase solar and wind power will hamper the generators' operating
cash flows, Fitch Ratings said on Wednesday.
The ratings firm
said that it expects the Andhra Pradesh government to face vigorous
challenges from the operators of renewable power projects and the
Central government.
Accordingly, Fitch said it will treat the
"successful renegotiation of the power purchase agreements (PPAs), if
any at all, as event risk in our credit assessment of rated bonds issued
by restricted groups (RGs) of Indian renewable companies".
The
development comes after the Andhra Pradesh government earlier this month
formed a high-level committee to renegotiate wind and solar PPAs in the
state, citing high tariffs that state distribution companies pay under
the contracts.
The Central government has cautioned the state
against proceeding with the plan, but a recent statement by the
principal advisor to the Chief Minister shows the Andhra Pradesh
government is set on its path.
"Fitch believes the state
government will need to appeal to state regulators and then seek consent
from the courts to overturn the existing PPAs. The attempt to
renegotiate or cancel PPAs previously approved by state regulators is
likely to face legal challenge from renewable operators and the Central
government.
"Indian state distribution companies in other states,
including Karnataka, Uttar Pradesh, Gujarat, Tamil Nadu and Madhya
Pradesh, have previously tried to renegotiate PPAs to capitalise on
falling solar and wind tariffs, according to press reports. However, the
Central government, supported by legal judgements, has instructed the
companies to abide by the PPAs," the ratings firm said.
|
|
|
|
|
|
|
|
|
|
|
|
|
Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
|
66.20
|
64.50 |
UK Pound
|
87.50
|
84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
|
|
Daily Poll |
|
|
PM Modi's recent US visit to redefine India-US bilateral relations |
|
|
|
|
|
Commented Stories |
|
|
|
|
|
|
|
|