CERC proposes uniform price cap for inter-state sale

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Mumbai, Sep 2: The Central Electricity Regulatory Commission has proposed unioform price cap of Rs 5 per unit and Rs 6 (during 6 pm and 10 pm) per unit for inter state short-term sale. In a bid to prevent profiteering at the cost of ultimate consumers of power deficit states, price caps have ben proposed below the replacement cost of electricity and it will be applicable for all distribution utilities or state trading outfits managing the power portfolio of distribution utilities of a state. Price caps will also be applied to coal/lignite/hydro based independent power projects (IPPs), merchant power plants (MPPs ), captive power plants (CPPs) and to state governments owning free hydro power.

CERC in is staff paper on "Measures for restraining the prices of electricity in short term sale/trading" has said that most of the traded power is sourced from coal/hydro plants and the production cost of such power is not more than Rs 4 per unit in most of the cases. As against this, the prices discovered in power exchange (which can not be much different from the bilateral traded power) have ben in the range of 90 paise to Rs 9 per unit. But the price in most of the time bocs have been in the range of Rs 6 to 8 per unit./ Even in the bilaterally traded electricity in 2007-08, 33% fo the electricity was traded at the price higher than Rs 6.