The Ministry of Power on Saturday announced new rules
to sustain economic viability of the sector
Topics
Power ministry | Sustainability
The Ministry of Power on Saturday announced new rules
to sustain economic viability of the sector, ease financial stress of various stakeholders and ensure timely recovery of costs involved in electricity generation.
The ministry notified rules for the sustainability of the electricity sector and promotion of clean energy to meet the India’s commitment towards climate change, a statement said.
Investors and other stakeholders in the power sector had been concerned about the timely recovery of the costs due to change in law, curtailment of renewable power and other related matters.
The rules notified by the Ministry of Power under Electricity Act, 2003 are in the interest of the electricity consumers and the stakeholders, it added.
The rules include Electricity (Timely recovery of costs due to Change in Law) Rules, 2021. The other rule is Electricity (Promotion of generation from renewable sources of energy by addressing Must Run and other matters) Rules, 2021.
The ministry explained timely recovery of the costs due to change in law is very important as the investment in the power sector largely depends upon the timely payments.
“At present, the pass through under change of law takes time. This impacts the viability of the sector and the developers get financially stressed. The rules would help in creating investment friendly environment in the country,” it stated.
“The energy transition is happening across the globe. India has also made commitments to bring about energy transition. India has also announced international commitment to set up 175 GW of RE capacity by 2022 and 450 GW by 2030,” the ministry said.
The ministry said these rules will help in achieving the targets of RE generation. This will ensure that the consumers get green and clean power and secure a healthy environment for the future generation.
A formula has been provided to calculate adjustment in the monthly tariff due to the impact of change in law.
The rules also provide that a must-run power plant shall not be subjected to curtailment or regulation of generation or supply of electricity on account of merit order dispatch or any other commercial consideration.
The electricity generated from a must-run power plant may be curtailed or regulated only in the event of any technical constraint in the electricity grid or for reasons of security of the electricity grid.
For curtailment or regulation of power, the provisions of the Indian Electricity Grid Code shall be followed.
In the event of a curtailment of supply from a must-run power plant, compensation shall be payable by the procurer to the must-run power plant at the rates specified in the agreement for purchase or supply of electricity.
The RE generator is also allowed to sell power in the power exchange and recover the cost suitably. This helps in realisation of revenue by the generator and also the power is available in the electricity grid for use of consumers.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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The Ministry of Power on Saturday announced new rules to sustain economic viability of the sector Topics Power ministry | Sustainability The Ministry of Power on Saturday announced new rules to sustain economic viability of the sector, ease financial stress of various stakeholders and ensure timely recovery of costs involved in electricity generation. The ministry notified rules for the sustainability of the electricity sector and promotion of clean energy to meet the India’s commitment towards climate change, a statement said. Investors and other stakeholders in the power sector had been concerned about the timely recovery of the costs due to change in law, curtailment of renewable power and other related matters. The rules notified by the Ministry of Power under Electricity Act, 2003 are in the interest of the electricity consumers and the stakeholders, it added. The rules include Electricity (Timely recovery of costs due to Change in Law) Rules, 2021. The other rule is Electricity (Promotion of generation from renewable sources of energy by addressing Must Run and other matters) Rules, 2021. The ministry explained timely recovery of the costs due to change in law is very important as the investment in the power sector largely depends upon the timely payments. “At present, the pass through under change of law takes time. This impacts the viability of the sector and the developers get financially stressed. The rules would help in creating investment friendly environment in the country,” it stated. “The energy transition is happening across the globe. India has also made commitments to bring about energy transition. India has also announced international commitment to set up 175 GW of RE capacity by 2022 and 450 GW by 2030,” the ministry said. The ministry said these rules will help in achieving the targets of RE generation. This will ensure that the consumers get green and clean power and secure a healthy environment for the future generation. A formula has been provided to calculate adjustment in the monthly tariff due to the impact of change in law. The rules also provide that a must-run power plant shall not be subjected to curtailment or regulation of generation or supply of electricity on account of merit order dispatch or any other commercial consideration. The electricity generated from a must-run power plant may be curtailed or regulated only in the event of any technical constraint in the electricity grid or for reasons of security of the electricity grid. For curtailment or regulation of power, the provisions of the Indian Electricity Grid Code shall be followed. In the event of a curtailment of supply from a must-run power plant, compensation shall be payable by the procurer to the must-run power plant at the rates specified in the agreement for purchase or supply of electricity. The RE generator is also allowed to sell power in the power exchange and recover the cost suitably. This helps in realisation of revenue by the generator and also the power is available in the electricity grid for use of consumers.(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.) Dear Reader, Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance. We, however, have a request. As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed. Support quality journalism and subscribe to Business Standard. Digital Editor