To meet the high demand of power during the summer months, the government has decided to give priority to power plants over the liquefied petroleum gas (LPG) plants in the allocation of Reliance Industries’ KG basin gas. A quantity of 3 million standard cubic metre (mscmd) is earmarked for the LPG plants.
KG basin, which started gas production earlier this month, is expected to reach an output of 40 mscmd by July-end.
The empowered group of ministers (EGoM) on commercial utilisation of gas under the New Exploration Licensing Policy (Nelp), headed by External Affairs Minister Pranab Mukherjee, has taken a decision to this effect in its meeting on April 9. The decision has been taken after an assurance from the Ministry of Petroleum and Natural Gas that it will not adversely impact the availability of LPG and the waiting time for getting new LPG connections.
The power shortage during the peak summer months is generally higher due to extreme weather conditions, combined with higher agricultural load.
“The peak demand shortage generally varies in the range of 10-18 per cent across the states. The decision to give priority to power sector during summer will definitely provide some respite to the power-starved states in managing the load during the summer, when the demand generally picks up. During such times even the peak load hydro power projects are generally down because of non availability of water,” said Rakesh Jain, general manager (energy), Feedback Ventures.
“A decision has been taken to supply the first 40 mscmd of gas to meet the shortfall in the existing gas-based urea plants, LPG plants and power plants,” Petroleum Minister Murli Deora said on February 18.
Following this, the EGoM approved an allocation of 15 MSCMD of KG basin gas to the fertiliser plants, while approving another 18 mscmd for the power plants and 5 mscmd has been earmarked for city gas distribution projects.
According to the country’s gas utilisation policy, fertiliser plants have the first priority, followed by LPG plants, power plants and city gas projects.
