Millennium Post

Power panel discusses ways to pass fuel cost rises to consumer

The high-level advisory panel on power sector on Wednesday discussed possible amendments to the Electricity Act and made various suggestions, including mechanism to pass through higher fuel costs to consumers.

The government-appointed committee, chaired by Power Minister Jyotiraditya Scindia, during its meeting on Wednesday deliberated on amendments to the Electricity Act 2003, sources said.

According to them, a sub-group of the panel presented a detailed report on amendments to the Electricity Act.One of the suggestions made by the committee is to have a formula which would ensure that variation in fuel and power purchase cost is recovered by the generators.

A change in the Act in this regard would help in clarifying the need for surcharge formula which at minimum covers various costs, including mix variance that are to be passed through to consumers in a reasonable time-frame, sources further said.

Such a suggestion comes at a time when many power plants are facing issues related to rise in fuel costs, especially pricier overseas coal.
Besides, the panel has mooted the idea of having a cyber security policy to protect the country's electricity system.

The advisory group was set up against the backdrop of multiple problems, including acute fuel shortages, hurting power generation in the country.
It has already discussed various issues related to coal, hydro and gas-fired power generation and transmission of electricity.Members of the group include representatives from power producers and public sector lenders.

Tata Group Chairman Cyrus Mistry, Reliance Group Chairman Anil Ambani, SBI Chairman Pratip Chowdhary, ICICI Bank Managing Director Chanda Kochhar, BHEL Chairman and Managing Director B P Rao and Jaypee Group Chairman and CEO Manoj Gaur are part of the panel.
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