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Consumers can soon expect some relief every time they pay their electricity bills. The Ministry of Power has allowed a power generation company (Genco) to supply cheaper power from any of its power plants to meet its commitments to a power distribution company (Discom).
This has been enabled under a scheme for flexibility in generation and scheduling of thermal power stations to reduce the cost of power to consumers. The scheme is in continuation of an earlier scheme that allowed Gencos to supply cheaper renewable energy instead of committed thermal power to Discoms.
According to the new scheme, “At present, the Discoms/States tie-up for supply of power from various power stations/generation companies. States generally requisition power from a station on day ahead basis considering its merit order among all the stations from which it has power tie-up.”
“However, on a national level, it is seen that many stations having low Energy Charge Rate (ECR) are not fully scheduled whereas the costlier stations are scheduled at the same time. The needy beneficiaries are not able to schedule power from stations having lower ECR as they do not have power allocation/Power Purchase Agreement (PPA) in these stations. They have no option but to schedule the costlier power available in their basket,” the scheme notes.
According to the scheme document, the Gencos now will be allowed to supply cheaper power if available. Effectively the power purchase agreement is to be serviced by the company it has signed, say NTPC Ltd, and not the power plant associated with it.
The scheme said, “The surplus realised, if any, from supply of power from station having lower ECR in place of costlier thermal power not scheduled and billed due to national merit order operation of its stations by a generating company shall be shared with the beneficiaries in the ratio 50 (beneficiaries):50 (generating company) on monthly basis with quarterly reconciliation.”
It is expected that the scheme will lower the overall cost of supply of power.
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