The Maharashtra Electricity Regulatory Commission (MERC) has allowed distribution business of Tata Power to have a power purchase arrangement (PPA) with its generation arm for 700 MW to be supplied from its Trombay thermal and hydro plants for five years.
The PPA will be effective from April 1 and will ensure cheaper power to Mumbai consumers, the company said on Wednesday.
After due diligence for ensuring the reliability of supply and cost competitiveness for consumers in Mumbai, the commission in its order on Tuesday approved the arrangement.
'Tata Power has been serving the city of Mumbai for over a century and continues to be committed to supplying the most reliable and competitive power meeting the needs of their consumers," said company's Managing Director and CEO Praveer Sinha.
Earlier in January, the commission approved the PPA of Tata Power with Brihanmumbai Electricity Supply and Transport (BEST) for 677 MW. The process of power tie-up was undertaken by the distribution business for five years starting April 1. The existing power tie-up was scheduled to expire on March 31.
Tata Power is India's largest integrated power company and, together with its subsidiaries and jointly controlled entities, has an installed capacity of 10,757 MW.