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Govt allows clubbing fuel supplies to units of same firm

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SummaryWith natural gas output from Reliance Industries’ KG-D6 block showing no signs of recovery, the Petroleum Ministry on Thursday relaxed fuel usage norms to allow power companies

With natural gas output from Reliance Industries’ KG-D6 block showing no signs of recovery, the Petroleum Ministry on Thursday relaxed fuel usage norms to allow power companies to divert natural gas allocated for one of their plants to another to achieve optimal operations.

“Considering the fact that many power plants are operating at low plant load factor (PLF) due to acute shortage of domestic gas leading to inefficient production of electricity, the ministry has notified guidelines for clubbing/diversion of allocated gas between two or more power plants of the same entity so as to improve the PLF and corresponding increase in total generation of electricity,” said a press release.

However, it set conditions for availing clubbing/diversion: end-use of the diverted gas should remain the same — supplying the power to the state distribution companies and should lead to higher production of electricity compared to pre-clubbing arrangement.

“The power plants would, therefore, have to obtain no objection from the concerned power discoms to which they are supplying electricity and the Ministry of Power shall operationalise the arrangement,” it emphasised.

Moreover, the ownership structure of the power plants involved in this exercise must be identical and the diversion, in all spells, should not be for a period of more than a year in total.

“The cost of the gas, so diverted, would be in accordance with the price based on the source of the diverted gas so that there is no financial burden on the end consumers.”

At present, gas usage is restricted to the specific units that has been provided the gas linkage. With limited supply at each plant, the PLF had turned sub-optimal at each unit.

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