Tata Power to restart Mundra UMPP units to supply low-cost electricity

Tata Power has decided to restart its Mundra ultra mega power project (UMPP) units to supply low-cost electricity. This comes at a time when there's rising demand for electricity from its five dedicated power-consuming states. The company had in March briefly shut three of its Mundra units over lack of revised tariff.

The private power producer will restart these units for the same reason it had shut them - lower tariffs.

“Considering India's present condition  when the country is hugely impacted by Covid-19, it is time for us to contribute to the might of the country in this nation-building exercise by supporting and running power plants like Mundra UMPP, which can provide low-cost power to consumers in these states,” Tata Power said in response to Business Standard on Tuesday.

The company said "in deference to the demands of the states and the extraordinary condition", it has decided to restart the Mundra UMPP units.

According to a weekly (March 16-22) MIS report for western regional load dispatch centre, three of Mundra’s five units were under generation outage starting March 21. The reason stated for the outage was non-signing of the supplemental power purchase agreements (PPAs).

Tata Power supplies power to five states — Maharashtra, Gujarat, Rajasthan, Punjab, and Haryana — from the 4,000-megawatt plant. Beginning March this year, Tata Power sent a shutdown notice to these states over delay in adopting the high powered committee recommendations and entering into supplemental PPAs for higher tariff.

On March 11, Tata Power said it has agreed to continue to supply power to the states up to March 20, giving them time to arrive at a decision on the tariff.

A senior executive from a distribution company (discom) said last week, “We have formed a new resolution plan and need to take it to Cabinet for approval. Other states will also need to do the same."

The executive did not disclose details of the new resolution. Last week, he  said, “In the interim, Tata Power has decided to stop supplying power to us and pay a fine instead.”

Tata Power’s decision to restart Mundra units will now reverse this.

Tata Power welcomes MERC order on tariff cut for next 5 years

Tata Power on Tuesday said it was happy that its consumers in Mumbai would continue to get reliable and uninterrupted power at the most competitive tariffs for the next five years.

“We appreciate the Maharashtra Electricity Regulatory Commission (MERC) for timely release of order despite the adverse situation the country is facing due to Covid-19. The new tariff order would boost industrial development due to proposed reduction in commercial and industrial tariff,” the company said in its statement.

The Maharashtra government on Monday announced an average 8 per cent electricity tariff cut for the next five years to help businesses and people tide over the Covid-19 crisis.

For consumers served by private sector discoms Adani Energy and Tata Power in the financial capital, industrial units will have their power rates slashed 18-20 per cent, commercial establishments 19-20 per cent, and residential ones 10-11 per cent, it said.

Executives at Adani Electricity did not comment on the order.

With inputs from PTI