The Cabinet Committee on Economic Affairs (CCEA) is likely to approve tomorrow the amendments in the Mega Power Policy to push 31 GW stuck projects entailing an investment of Rs 1.5 lakh crore.
Besides, the initiative is aimed at bringing down the power tariff for making electricity more affordable for domestic as well as industrial and commercial consumers.
"The proposal to amend the Mega Power Policy for giving a boost to stuck coal and gas based power projects totalling 31GW capacities is listed for consideration and approval on the CCEA agenda for the meeting scheduled on March 29, 2017," a source said.
The source said that out of these stuck project which have not imported or not inked power purchase agreement would get extra time to seek various benefits under the policy.
The source further said that all those plant which have already imported the equipment would get additional 60 months for inking power purchase agreements with discoms/states.
The source also said that that an additional time period of 120 months would be provided to those project for which equipment has not been imported, under the policy for seeking various benefits.
This relaxation in time frame would help all of these 31GW capacities to unlock total various benefit of over Rs 10,000 crore under the policy as they would get incentives ranging from Rs 30-40 lakh per MW.
These 31GW include around 3,300 MW of gas based thermal power generation capacities and the remaining projects are coal based.
The Mega Power Policy was unveiled in 2009 with an objective to increase power availability, to boost overall growth of the country and also to ensure that consumers are reasonably charged for electricity supplied.
The policy was later amended in 2014 mandating developers to tie up at least 65 percent of installed capacity/net capacity through competitive bidding and 35 per cent under regulated tariff of host state under long term Power Purchase Agreement (PPA) with discoms/State designated agency to avail benefits under the policy.
The amendment had provided this dispensation would be one time and limited to 15 projects which are located in the states having mandatory host state power tie up policy of PPAs under regulated tariff.
The other amendment was for extension of the maximum time period to 60 months instead of 36 months from the date of import for provisional mega projects, for furnishing final mega certificates to tax authorities.
The benefits under the policy include zero customs duty, deemed export benefits and income tax benefits.
The mega power projects include an inter-state thermal power plant of a capacity of 700 MW or more, located in the states of Jammu and Kashmir, Sikkim, Arunachal Pradesh, Assam, Meghalaya, Manipur, Mizoram, Nagaland and Tripura.
It also include projects with a capacity of 1,000 MW or more, located in states other than specified the policy.
These projects also include an inter-state hydel power plant of a capacity of 350 MW or more, located in the states of Jammu and Kashmir, Sikkim, Arunachal Pradesh, Assam, Meghalaya, Manipur, Mizoram, Nagaland and Tripura.
Besides, it also include an inter-state hydel power plant of a capacity of 500 MW or more, located in states other than specified in the policy.
Disclaimer: No Business Standard Journalist was involved in creation of this content
