Govt asks states to buy power from exchanges

Even as some parts of the country grapple with electricity shortages, the government on Thursday said there is sufficient availability and urged states to purchase power from the exchanges.

Union Minister Piyush Goyal told the Lok Sabha that most parts of the country have surplus power and noted that states need to buy electricity from power exchanges or through power purchase agreements. “The sad part is that states are not acquiring or buying enough power to be able to give their residents uninterrupted power supply,” Goyal said during Question Hour.

There is sufficient power available and states should purchase electricity, he said while noting that many members are requesting him that there should not be power cuts. To underline his point, Goyal said that on Wednesday at the Power Grid’s Monitoring Office he saw that electricity was available at “zero rupee per unit at 3.30 pm”.

“Power was surplus so much that people were willing to give power at zero rupee per unit because there is no other way to use that power,” he said. Goyal suggested that new gas-based power plants should not be set up as many existing ones are stranded. “I would rather say that they (states) set up a solar plant in that same land rather than going in for a gas-based plant,” Goyal, who is in charge of Power, Coal and New and Renewable Energy Ministries, said. Goyal also exuded confidence that India would stop importing thermal coal in the next one or two years as the country’s domestic coal production is increasing.

Overall coal production in the country has grown up by 8.3 per cent. In the first 28 days of April, Coal India’s production increased by 10.2 per cent, he noted. “We are confident that in the next year or two, we will be able to stop imports of thermal coal while imports of coking coal will continue till we are able to explore more reserves,” the Minister said. Responding to a question with regard to high solar energy prices, Goyal said the government is working to reduce it to less than Rs 5 per unit with innovative financing models. At present, the cost is about Rs 7 per unit.

“I am considering offering dollar tariffs to developers and creating a self-hedging mechanism with a power purchaser,” he said. Goyal also said that 114 units of under-construction thermal power projects with aggregate capacity of 57,125 MW are running behind schedule. The figures are based on information given by project developers to the Central Electricity Authority (CEA). “A total of eight coal-based thermal generating units with aggregate capacity of 1,150 MW are closed for renovation and modernisation/life extension works,” he said.