Transmission projects won under tariff based competitive bidding and those awarded to Power Grid Corporation for system strengthening will now benefit from early commissioning of projects.

The Power Ministry has issued an order allowing such projects to start getting transmission charge from the date of commercial operations, even if it is ahead of schedule.

While transmission charge will start to accrue early for such projects, the length of applicability of tariff will remain unchanged at 25 or 35 years as may be the case.

The order was issued this week, subject to be implemented with effect from June 12. Therefore, transmission projects commissioned ahead of schedule after June 12 will also be eligible for the incentive.

The move comes as northern states suffer from transmission constraints. In a note on Friday, the Domestic Coal based Power Producers Association said over the last month there has been restricted flow of power to the Northern Region from the Eastern Region and Western Region.

“This has resulted in purchase price of power to increase from ₹2 a unit to above ₹4 a unit for these States,” the association said.

The situation is impacting power generators in the east and west of India as they claim that demand is low in both these regions making Northern Region the only key market as transmission constraints have long affected the south.

Related Topics
comment COMMENT NOW