The Cabinet Committee on Economic Affairs (CCEA) has approved amendments in the Mega Power Policy, 2009 to push 31 GW stranded projects entailing an investment of Rs 1.5 lakh crore.
The initiative mainly aims at bringing down power tariff for making electricity more affordable and achieving the ambitious goal of 24X7 power for all.
- The amendment extends the time period for the provisional Mega projects (25 projects), for furnishing the final Mega certificates to the Tax authorities to 120 months instead of 60 months from the date of import.
- However, developers will be required to keep their Bank Guarantee (in lieu of duty exemption claimed) or Fixed Deposit Receipt (FDR) alive.
- CCEA also approved 25 projects for Mega Policy benefits in proportion to long term PPA (Power Purchase Agreement), as permitted under the policy, once specified threshold capacity of project is commissioned.
- However, the money realized by the developer, as a result of release of proportionate Bank Guarantee will first be utilized for repayment of the Bank dues by the developer.
- Further a suitable mechanism will be worked in consultation with Department of Revenue (Finance Ministry) for operationalisation of release of proportionate Bank Guarantee.
This decision is expected to enable developers to competitively bid for PPAs in future. Once the developer commissions the specified threshold capacity, proportional mega benefits will facilitate easing out liquidity crunch with the banks/developers and improve the viability of their projects. Increased power availability will further boost country’s overall growth and also ensure that cost of power to the consumers does not increase.