 "Piyush Goyal")
Initiating a major reform process in the power sector that faces a demand-supply mismatch, Piyush Goyal, minister of state for coal, power, renewable energy and mines, said states had been persuaded to sell unused power in the spot market.
According to the draft policy discussed in the state ministers’ meeting, around 59-75 per cent of the power not purchased by states will automatically be deemed to be sold on the spot market.
“Instead of the day-ahead spot market, we will aim at the hourly power purchase market. This will help generators recover costs. This is a natural progression as we are moving from an absolute deficit to a power surplus situation,” said Goyal.
PK Pujari, secretary, ministry of power, said guidelines would be prepared in consultation with the states.
As the sale of power outside a state entails changes in the open access policy, it may require introducing enabling provisions in the Electricity Act.
“We do not need to wait for the Electricity Act to be amended. All my work is being done without any legislative changes,” said Goyal.
On whether the Act would be placed in the winter session of Parliament, he said no reforms were dependent on the Act.
Business Standard recently reported that the increasing risk in long-term power sale is pushing private developers to sell in the spot market at half the tariff they quote in power purchase agreements.
Private players and some states have been active in the spot market, and NTPC has also recently started selling un-requisitioned surplus power on the exchanges. NHPC, Neyveli Lignite and more states would soon follow suit, industry executives said.
While the tariff quoted in long-term power purchase agreements has touched Rs 3.9-5.5 per unit, the spot rate has declined to Rs 2.16 per unit during the same period.
The day-ahead spot market is 3 per cent of the total power market but sets benchmarks for medium-term and long-term power rates.
According to the draft policy discussed in the state ministers’ meeting, around 59-75 per cent of the power not purchased by states will automatically be deemed to be sold on the spot market.
“Instead of the day-ahead spot market, we will aim at the hourly power purchase market. This will help generators recover costs. This is a natural progression as we are moving from an absolute deficit to a power surplus situation,” said Goyal.
PK Pujari, secretary, ministry of power, said guidelines would be prepared in consultation with the states.
As the sale of power outside a state entails changes in the open access policy, it may require introducing enabling provisions in the Electricity Act.
“We do not need to wait for the Electricity Act to be amended. All my work is being done without any legislative changes,” said Goyal.
On whether the Act would be placed in the winter session of Parliament, he said no reforms were dependent on the Act.
Business Standard recently reported that the increasing risk in long-term power sale is pushing private developers to sell in the spot market at half the tariff they quote in power purchase agreements.
Private players and some states have been active in the spot market, and NTPC has also recently started selling un-requisitioned surplus power on the exchanges. NHPC, Neyveli Lignite and more states would soon follow suit, industry executives said.
While the tariff quoted in long-term power purchase agreements has touched Rs 3.9-5.5 per unit, the spot rate has declined to Rs 2.16 per unit during the same period.
The day-ahead spot market is 3 per cent of the total power market but sets benchmarks for medium-term and long-term power rates.
