 "UP power bids see rates shoot up to Rs 5.5 a unit")
Among the bidders were Jindal Power, Lanco, Adani Power, GMR and JSW. The lowest bid of Rs 3.9 a unit was put by Jindal India Thermal Power, while the highest was Rs 5.5 a unit by Essar Power.
The state would procure a total of 3,882 Mw and the final closing tariff is Rs 4.06 a unit.
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Uttar Pradesh had signed power purchase agreements with power producers for 5,056 Mw in February for prices ranging from Rs 3.2 to Rs 5.10 a unit.
"As uncertainty looms over long-term power supply under regulated regime, the bids are reflective of the risk allocation. The spot power prices are going down and this poses questions over such high bids," said a power sector expert.
The move by the state to sign fresh agreements at high rates comes at a time when the power prices in the spot market have touched a new low of Rs 2.16 a unit. Uttar Pradesh doesn't procure power from exchanges citing fluctuating price.
The UP State Electricity Regulatory Commission has initiated a suo-motu hearing on UP Power Corporation's procurement of costly power despite cheaper options available.
The state will go to polls in February 2017 and power is one of the main agendas for political parties.
Of the state's total power drawal of 9,281 Mw, 4,225 Mw is from inter-state generating stations, 228 Mw from long-term agreements, 364 Mw from medium-term agreements, 150 Mw through bilateral trade, and 26 Mw as shared agreement.
Reeling under power cuts and irregular power supply, UP suffered from supply deficit 14 per cent during April-June 2016 - one of the highest in the country, according to data with the Central Electricity Authority.
UP Chief Minister Akhilesh Yadav in his state Budget for 2015-16 had promised 22 hours of power supply in rural areas and 24 hours in urban areas by 2016.