Tangedco paid 453 cr. without purchasing a single system of power from personal business

The CAG, in the yearly report for the year ending March 2021, discovered that Tangedco made a payment of 453.04 crore to PPN Power Generating Company Private Limited without acquiring a single system of power from the company. Mentioning the failure of Tangedco to end the power purchase arrangement (PPA), the CAG explained that it had actually led to a preventable payment to the tune of 453.04 crore, made from March 2020 to November 2021 for costs raised by PPN for the duration from April 2016 to 2021, and an extra liability of 360.20 crore which might be declared by the power creating business. The substantial payment relate to the PPA concurred in between Tangedco and PPN for acquiring 330.50 megawatt (MW) of power for a duration of 30 years. The Central Electricity Authority, while providing the techno-economic clearance for the PPA, had actually directed PPN to utilize the fuel mix of gas and naphtha in the ratio of 70:30. As there was a hold-up in the accessibility of gas, PPN asked for the TNEB’s nod for utilizing 100% naphtha. The TNEB, in November 1996, granted using 100% naphtha as an alternative fuel till gas was offered. With TNEB having actually provided its approval, PPN participated in a Fuel Supply Agreement (FSA) with Indian Oil Corporation Limited (IOCL) for supply of naphtha for a duration of 20 years, to be utilized for the task. PPN provided an endeavor to TNEB that it would restrict the FSA to 15 years, after the C
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