New Delhi: The YSR Congress Party has claimed that there are no direct agreements between Andhra Pradesh DISCOMs and the Adani Group, a day after the mention of a “Foreign Official #1” in a US Attorney Office’s criminal indictment against billionaire industrialist Gautam Adani has caused a storm in Andhra Pradesh’s political circles.
Former Andhra Pradesh chief minister Jaganmohan Reddy was at the helm of affairs in Andhra Pradesh in the duration of the purported scandal involving bribes worth several millions having been paid to Indians officials. The Adani Group has claimed that the charges are baseless and denied them.
“There is no direct agreement between AP DISCOMs and any other entities including those belonging to the Adani group. Therefore, the allegations made on the State Government, in the light of the indictment are incorrect,” the party wrote in a statement on X.
As The Wire noted in its report, the public copy of the indictment anonymises several names and institutions, among which is “Foreign Official #1″ – a citizen of India who resided in India and served as a “high-ranking government official of Andhra Pradesh” between May 2019 through June 2024. In June 2024, Andhra Pradesh saw a change in government and Jagan was replaced with Chandrababu Naidu.
The Wire corroborated the indictment’s claim on Gautam Adani himself meeting with ‘Foreign Official #1’ in 2021 with news reports on a purported “secret” meeting between Adani and Jagan.
It is noteworthy that the indictment does not claim that there was a direct agreement between Andhra Pradesh and Adani but that “approximately 1,750 crore rupees of the corrupt payments was offered to Foreign Official #1 in exchange for Foreign Official #1 causing Andhra Pradesh’s state electricity distribution companies to agree to purchase seven gigawatts of solar power from SECI under the Manufacturing Linked Project.”
The YSRCP’s note was a lengthy description of power distribution equations in the state and claimed that exorbitant power purchase agreements between distributors and the state government had been the doing of previous Andhra Pradesh government.
It claimed that the 10,000 megawatt solar project plan was to mitigate the costs of free power for agriculture.
“Andhra Pradesh distribution utilities supply close to 12,500 MU of free power per annum to agriculture sector. On this front, the Government compensates the distribution utilities to the extent of the cost of supply pertaining to that power. Owing to the policies of the previous Governments in the State of Andhra Pradesh, PPAs at exorbitant tariffs were executed.
“This was making the subsidy cost very burdensome on AP Government. With a view to mitigate this problem, the State Government of Andhra Pradesh in 2020 proposed to install 10,000 MW of solar capacity in solar parks to be developed in the state of AP.”
The party claimed that a tender was floated by Andhra Pradesh Green Energy Corporation Ltd. or APGECL in November 2020 for the development of solar power capacity aggregating to 6,400 MW power, “wherein over 24 bids were received with the tariffs in the range of Rs. 2.49 to Rs. 2.58 per kWh.”
“However, the tender encountered several obstacles on legal and regulatory front and therefore, the exercise could not fructify,” it claimed.
The State Government subsequently received an offer from SECI “to supply 7,000 MW of power at the lowest discovered tariff of Rs. 2.49 per kWh including waiver of ISTS charges.”
The statement notes thrice that SECI is a Government of India enterprise.
“SECI, a Government of India owned entity, functioning under the administrative control of Ministry of New and Renewable Energy, Government of India will procure power from projects selected under the Request for Selection (RfS) issued by RfS No. SECI/C&P/RfS/2GWMANUFACTURING/P-3/R1/062019 dated 25.06.2019.”
“In the light of this, the Government of Andhra Pradesh entered into an arrangement to procure power from SECI (Solar Energy Corporation of India), to the tune of 7,000 MW at Rs. 2.49 per kWh for 25 year period with 3,000 MW commencing in FY 2024-25, 3,000 MW commencing in FY 2025-26 and 1,000 MW commencing in FY 2026-27 with waiver of the ISTS charges.”
“It is worth mentioning that, the power procurement of 7,000 MW was approved by Hon’ble APERC vide its order dated 11-Nov-2021. After the APERC approval was obtained, the Power Sale Agreement (PSA) was signed on 1-Dec-2021 between SECI and AP Discoms.”
“This was after the CERC approval as well. It is necessary to mention that SECI is a Government of India enterprise.”
It then claimed that there is no direct agreement between AP DISCOMs and any other entities including those belonging to the Adani group. “Therefore, the allegations made on the State Government, in the light of the indictment are incorrect,” it said.
The indictment notes that Andhra Pradesh’s electricity distribution companies entered into a PSA [or power supply agreement] with SECI on or about December 1, 2021, pursuant to which the state agreed to purchase approximately seven gigawatts of solar power – “by far the largest amount of any Indian state or region.”
It also added that the project is favourable to Andhra Pradesh:
“Further, there is an express stipulation in the order of Ministry of Power, Government of India to the effect that the ISTS charges with respect to projects selected under the tender issued by RfS No. SECI/C&P/RfS/2GWMANUFACTURING/P-3/R1/062019 dated 25.06.2019 are waived for a period of 25 years. Therefore, the project does not entail any burden on account of ISTS charges. Owing to these reasons, the project is extremely favourable with respect to the interests of the State and procurement of power at such cheap rate would substantially benefit the State with a saving of Rs. 3,700 crores per annum. As the agreement is for a period of 25 years, the total benefit to the State on account of this agreement would be immense.”
