Govt plans to sell power from unallocated quota via exchanges

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New Delhi: The power ministry on Tuesday proposed that 15% of the unallocated quota from the central sector will be sold through power exchanges. This is to bring in competitive price, transparency and curbing the power price during shortages. This was disclosed by power secretary HS Brahma here on Tuesday at the first anniversary of of Indian Energy Exchange (IEX).

Brahma’s statement is expected to ignite heated debate as currently the Centre has discretion to allocate power from its 15% quota to state and during emergencies the it (Centre) can divert allocated power of one state to another from this unallocated quota. However, NTPC and states may oppose Brahma’s proposal.

Brahma told FE ‘‘This is one of the proposals under the ministry’s consideration. This will lead to competitive pricing, reliability of power and transparency.’’ At least to start with 7.5% of the unallocated quota can be sold through power exchanges. At present, the 15% unallocated quota is at the Centre’s discretion and during emergencies the centre has power to divert some of the power from the same quota from one state to another.’’

However, a former power secretary on condition of anonymity said states will not like to procure power from the unallocated quota through exchanges as they fear that exchanges may pursues their profiteering motive. Besides, NTPC, whose power comes under the 15% unallocated quota, would not release it to exchanges.

Power ministry official said that a committee headed by the Planning Commission member BK Chaturvedi has proposed that power from the 15% unallocated quota can be made available directly to consumers who will benefit a lot.