NEW DELHI: Shopping malls, offices and other commercial consumers would be able to get electricity for 24 hours by paying a little more for grid supply instead of banking on very costly diesel generation as the government plans to help the establishment get the power that state utilities are refusing to buy.
The government also plans to facilitate supply of power from plants that are stranded because domestic fuel is scarce and imported coal costs are higher. This can ensure continuous supply for consumers, as about 20,000 mw generating units are stranded while the electricity deficit is just over 12,000 mw.
A committee set up by the power ministry on stranded electricity generation capacity has recommended allowing distribution companies to buy power from idle power plants and supplying to industrial and commercial consumers at no-profit-no-loss basis. The committee has drafted its report and its final copy would be submitted to the power ministry shortly.
Currently, only large industrial consumers with demand for over 1mw have the freedom to source power from sources other than power distribution utilities such as power exchanges. But with this scheme, the government proposes to extend the privilege to all high-tension consumers like small industries, shopping malls and office complexes. The move may prove to be a lease of life for industrial and commercial consumers that are either not operating or burning getting power from diesel gensets that cost around 12-14 per unit.
The proposal would also benefit state power generating companies like NTPCBSE -1.33 %, Haryana Power Generation Corporation and private firms like Adani PowerBSE -2.30 % and Lanco InfratechBSE -3.42 %.
Coal-based generating units with about 13,500 mw capacity and gas-based power plants of about 6,500 mw capacity of many companies are either idle or running at sub-optimal levels due to lack of fuel. The companies cannot fire the plants with imported fuel since state distribution companies cannot pay more for power.
"This will be a win-win situation for both power developers that are now shying from further investments and for consumers who want to pay extra if power is guaranteed," a power ministry official said. Power generating units that are not in operation for 15 days or operating at less than 60% of capacity will be considered stranded capacity under the scheme, he added.
On Friday, the government assured 65% domestic coal supply to 78,000 mw power plants commissioned or to-be-commissioned between April 2009 and March 2015.
The proposed scheme recommends empowering central and state electricity regulators to make required provisions for expensive purchases by state distribution utilities. Electricity regulators of states like Andhra Pradesh, Haryana and Odisha have already asked distribution utilities to source power on behalf of large industries that are willing to pay the generating companies. However, the schemes have not picked up since the large industries are opting for electricity from power exchanges at far less rates.