Tata’s power purchase agreement extended by 5yrs

The Maharashtra Electricity Regulatory Commission has allowed Tata Power Company-Distribution to extend its power purchase agreement with Tata Power Company-Generation by another five years. Mumbai's power utilities have been facing difficulties in availing the transmission corridor, resulting in higher tariffs for consumers. The transmission capability of Mumbai needs to be enhanced by nearly 60% for any power procurement plan to be executed.

Mumbai: The Maharashtra Electricity Regulatory Commission has allowed Tata Power Company-Distribution to extend its existing power purchase agreement with Tata Power Company-Generation by another five years, till 2029.

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The company had approached the commission in February 2023, seeking approval for its power procurement plan for the period 2024-25 to 2034-35. Power utilities in Mumbai have been facing difficulties in availing the transmission corridor since the past one decade. The utilities are also deprived from optimising their power purchase portfolio by purchasing cheap power from outside Maharashtra as there are constraints at the state periphery. On the contrary, they need to purchase high-cost power from embedded thermal generators of Tata Power-Generation, which is ultimately resulting in higher tariff for consumers in Mumbai. The transmission constraint for bringing power into Maharashtra and eventually to Mumbai is a well-recognised issue and a pressing one.

As of now, available transmission capability of Mumbai is around 2,522 megawatt, whereas Mumbai’s demand recently touched 4,100 megawatt. For any power procurement plan for Mumbai to be executed, Mumbai’s transmission capability needs to be enhanced by nearly 60%, which will take considerable time, the commission’s order said.