Shillong : Meghalaya has no other way now to escape but to pay dues to the National Thermal Power Corporation (NTPC) around Rs 565 crore due to the power purchase agreement (PPA) signed in 2007.
The Meghalaya cabinet has also approved on Wednesday that the state government would support the Meghalaya Energy Corporation Ltd (MeECL) to pay the dues to the NTPC in 20 installments.
In the past, Meghalaya has not drawn power from the NTPC as the price of power per unit was charged at a very high rate. However even if the state did not take power, it is mandatory for the state to pay to the NTPC.
“There is no other way to come out (of the agreement). But the state is now getting benefit because over Rs 100 crore, the NTPC will waive from whatever dues remaining, and there is a possibility now to lower the interest rate too,” Meghalaya power minister, AT Mondal told journalists after the state cabinet meeting on Wednesday.
“We have gone to court as it is the place where we could get respite, but as this was a mutual agreement between the two parties at that time, so the court has not given a favourable verdict,” Mondal said.
Meghalaya had already paid 50 percent of the dues Rs 244 crore out of Rs 488 crore, but the remaining dues accumulated over the months and the total pending dues come to Rs 664 crore.
However as Rs 100 crore would be waived, the pending dues come to Rs 565 crore which should be paid in 20 installments to the NTPC.
“The agreement signed (in 2007) was a bilateral decision from both sides. Now, we cannot just change that agreement and both parties should agree. That is why we went to court, but we did not get a favourable ruling,” Mondal said.
Mondal said that the PPA was signed in 2007, but it was executed from the date of the last unit of the NTPC that has been commissioned in 2017. Meghalaya will continue to pay for 25 years to the NTPC.
Mondal also said that since the prices of power in the open market have gone up, he hoped that the problem would be solved and if power is purchased from the open market, the price is more than the NTPC’s rate now.
“That is why we feel that this will now to some extent be helpful to us. Meghalaya is not having any other sources of generation other than hydel power, so this will give us respite also,” the Power Minister said.
