Coal

Power Min allows Ginkgo to impose countervailing tariff on coal import – business standard

The Union’s Ministry of Electricity allowed electricity units to impose a compensatory tariff instead of importing coal. This will cover both state-owned and privately owned power generating units (gencos).

“The methodology will be used by generation companies that supply power under Section 63 and state governments to calculate the compensation resulting from blending with imported coal. The billing and payment mechanism for these plants will be in accordance with the power purchase agreement,” the order said.

The directive was issued under Article 11 of the Electricity Law by the Ministry of Electricity.

Recently Business Standard reported that the state-owned NTPC will see the cost of fuel rise to Rs 7-8 per unit by importing coal and the final tariff will rise by 50-70 baisas which will be passed on to consumers.

Approximately 32 GW of power plants were constructed under Article 63 of the Electricity Law through competitive bidding. These units, unlike the NTPC, which are governed by Article 62, cannot pass the tariff without regulatory approval.

These units asked the Department of Energy to pass on the cost they incur due to the more expensive imported coal cost to consumers.

The Ministry of Electricity said in its memo: “The methodology was finalized in consultation with the Central Electricity Authority, which was discussed in the meeting held on May 20, 2022, with stakeholders. Based on the discussion, the methodology has been modified to make it in line with the current methodology that is adopted by by CERC (Central Electricity Regulatory Authority).

The center also directed the power distribution companies (inconveniences), to ensure adequate cash flow for the power plants, and pay at least 15 per cent of the temporary weekly bill by disturbances within a week of receiving the bill from these 32 gigawatts. the plants.

In its note, the ministry said that in the event of default, power plants could sell 15 percent of the electricity associated with this disruption in the energy exchange.

Recognizing that domestic coal stocks are not enough to meet the country’s energy demand, the center last week directed all states and power generation companies (gencos) to import coal before the monsoon comes.

The Ministry of Electricity has warned Juncos that the coal-blending standard will rise to 15 percent from the current 10 percent if they do not import coal by the end of this month. The directive also said that if blending does not start by June 15, the domestic coal allocation to the troubled thermal plant will be reduced by 5 percent.

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