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Uttar Pradesh bagasse cogen plants take aggressive posture over power dues

According to reports, with sugarcane arrears for the year 2011-12 of over Rs 1,800 crore yet to be cleared by private sugar mills in Uttar Pradesh, millers have demanded the state power utility to clear their power co-generation dues of over Rs 650 crore.

Mill owners have urged the Uttar Pradesh Power Corporation Limited (UPPCL) to settle dues, so that they could divert these payments to the sugarcane farmers.The millers supply bagasse-based power generated to UPPCL under a power purchase agreement (PPA). The dues have been pending for the last six months beginning January to June 2012, which stands at over Rs 652 crore.

The total sugarcane dues on state mills stands at about Rs 1,950 crore, including Rs 150 crore on cooperative units and the rest on private millers.

In a recent meeting with Avnish Awasthi, chairman and managing director, UPPCL, the UP Sugar Mills Cogen Association had urged for immediate release of pending payments against supply of bagasse-based power by sugar mills.

The power dues pertaining to the months of January, February, March, April, May and June stand at about Rs 92 crore, Rs 166 crore, Rs 155 crore, Rs 101 crore, Rs 84 crore and Rs 55 crore respectively.

Sources told Business Standard that the power utility, UPPCL, has, for the time being agreeing to release power dues for the month of January.

The Association said cogeneration units had supplied considerable amount of power to the UPPCL at a time when it was needed most and helped in mitigating the power deficit faced by UPPCL.

According to a Supreme Court order, the sugar mills were asked to settle cane arrears for 2011-12 by July 2012.

“However, the sugar mills failed to make payment owing to the fact they could not receive their dues from the UPPCL. The growers are agitating for their dues for which cane commissioner has also addressed a letter to you for the release of payments to co-generators urgently,” the Association told UPPCL.

During the crushing season, the mills have the capacity to produce 700 Mw of power.

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