The Orissa government is going to make certain changes in its power policy for IPPs (independent power producers) following the Centre’s directive that power will be sold on the basis of competitive bidding.
The state government will do away with the provisions that IPPs would offer 25% of the total power generated to the state at a price decided by the OERC and that the entire power generated above 80% of plant load factor (PLF) be given to the state at variable costs. Instead, the state now will ask for 12% of the total power generated at variable costs.
“We are proposing some changes in the power policy for IPPs in view of the Centre’s directive that producers would sell power at a competitive bidding process”, state energy minister SN Patro told FE. He said the necessary amendments would be made in the MoUs signed with IPPs.
Orissa has already singed MoUs with 13 IPPs for a total capacity of 14,990mw.
Sources in the state energy department said the provision of procuring power generated above 80% of PLF at variable costs was counter productive. As IPPs do not get any incentives for generating above 80% of PLF, they are unwilling to increase generation.
Interestingly, the state government’s power policy does not extend to the Central sector IPPs. The Centre has awarded two ultra mega power projects of 4000mw each to the state. Besides, NTPC is setting up a 4000mw plant in Sundergar district.
However, the Centre is not willing to share power with the state government according to the policy. It is also not ready to pay 6 paise per unit of power exported to other states. The government policy is aimed at compensating use of the state’s natural resources and pollution power plants will cause.