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Govt move to restate 20 INR and to scrap 12 INR cap in Indian power market

Sudheer Kumar Dwivedi's picture
Sr Manager Power Management MP Power Management Company Limited

A Certificate Energy Manager From BEE India and Certified Regulatory Professional from IIT Kanpur.

  • Member since 2022
  • 4 items added with 1,006 views
  • Aug 4, 2022
  • 358 views

Govt proposal of introducing a new segment of power trading on exchanges viz #HPDAM would be a relief to high cost power sources like gas based plants, would improve peak power access along with improving grid flexibility.  Following points shall be considered. 1) As per Ministry of Power data there is sufficient power available in peak and off peak periods. So what is need to increase DAM price. As Indian power market is not perfect market as of now i.e.last 6 months  HHI index calculated by CERC MMR cell.2)last year December most of the thermal plants across the nation were selling power at 20/- per kWh where as there actual incremental cost hardly of 6/- kWh. As of now most of the discoms purchasing power at 12/- kWh.If it again comes definitely discoms losses likely to inflate because of universal supply obligation.3) Avg agriculture unit cost recoverd by discoms through out the country approximately  57-60 Paise per Units without subsidy.  Current trends of getting subsidy i.e. already elaborated by Hon'ble PM will make discoms impecunious due to this proposal increased cost of supply to Discom from 12 to 20/- per kWh.4)To facilitate certain gas plants all over the country can not forced into the losses. As discoms recover energy charges from the common people. So  the Acos and ARR gap will increase i.e. ruin performance in Revamped Distribution Sector scheme launched by Hon'ble PM.
5) As in daily basis approximately 8 hrs ( 00:00-02:00 hrs , 18:00-24:00) 4000 MW (equivalent to 32  MUs per day) power traded on Exchange at price of 12/- Most of the southern and Western states are the major buyer. Suppose it will increase as per above citation then (32*8= 256 Million INR daily basis) in a month 7680 Million INR onus will come for the same power that may be purchased at lower price.
6) As per the national MOD incremental cost of thermal power plant through the nation maximum 8/- per kWh. So alreay these power plants getting 150% return increasing it to 250% by dozing  states to losses doesn't appear adjudicated.7) If MOP wants these Gas based  Plants to be scheduled i.e. RF ,LF,LNG,RLNG and Liquid. It should facilitate with bilateral or with RAS as per provisions available with NLDC or regional operator  with the specific industry which are looking very intensively rather than disturbing the balance of power market. Once HHI reached below 0.15 then this cap of 12/- per kWh in DAM shall be scrapped.

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Sudheer Kumar Dwivedi's picture
Thank Sudheer Kumar for the Post!
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