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On the account of greater allocation of power from central quota and higher prices, Bihar has decided to reduce its reliance on open market for electricity. The power starved state has already stopped purchasing electricity from Damaodar Valley Corporation (DVC).
"They (DVC) were asking for a much higher price," state Energy Minister Vijendra Yadav told Business Standard, "and we are not much stronger, financially. Therefore we had to let them go."
According to the government sources, the DVC was supplying power to state at the rate of Rs 3-4 per unit. State government wanted them to bring it down toRs . 2-2.5 per unit, but even after several rounds of discussion the company was not ready to relent. Therefore, the state government had to scrape the deal.
Meanwhile, the government sources indicate that the increased share of central allocation also played a big role in this. "We started buying from DVC since June last year. At that time, Bihar was going through power shortage on a mammoth scale. We needed 1,800-2,000 MW, but were receiving only 1,000-1,100 MW. Therefore purchasing power from open market was the only option left with us," said Yadav.
The minister added, "However, earlier this year, the central government increased our allocation and due to our continuous effort they had to ensure that Bihar get at least 1,700-1,800 MW every day. However, we have to pay for this one too, but its price is much reasonable. Therefore, we chose to let DVC go."
Meanwhile, the state government is also considering if it wants to continue buying electricity from Adani Power's units. "On the other hand, we are still purchasing 200 MW from Adani Power. However, as our quota in the central pool has been increased, we are trying to figure out new ways to reduce our costs."
The state needs 3,000 MW power every day, but due to its obsolete power infrastructure is forced to settle on the half of it.
