Lok Sabha Question No. 995 (UNSTARRED), answered on 2017-12-21
Subject: Norms for Private Power Plants
Ministry: POWER
Asked by: UDIT RAJ

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA UNSTARRED QUESTION NO.995 TO BE ANSWERED ON 21.12.2017

## NORMS FOR PRIVATE POWER PLANTS

995. DR. UDIT RAJ:

Will the Minister of POWER be pleased to state:

- (a) whether some of the efficient power stations are facing coal shortage at present while plants with low utilization record are possessing abundant fuel, if so, the details thereof;
- (b) whether under the new norms, the landed cost of power from the private power station should be lower than the variable cost of generation of the power generating plant of the State, if so, the details thereof;
- (c) whether  in  cases  where  Railways  find  that  transfer  of  coal  to  a  private power station is not feasible, then that plant would not be eligible to participate in bidding; and
- (d) if so, the details thereof?

## A N S W E R

THE MINISTER OF STATE (INDEPENDENT CHARGE) FOR POWER AND NEW & RENEWABLE ENERGY

( SHRI  R. K. SINGH )

(a) : Power plants get scheduled based on Merit Order Despatch. Therefore,  an  efficient  plant  is  likely  to  be  scheduled  and  consume  coal accordingly which may sometime lead to less stock available at the plant.

The Government, in 2016, has introduced flexibility in utilization of domestic  coal  amongst  power  generating  stations  to  reduce  the  cost  of  power generation.  Under  the  scheme,  the  Annual  Contracted  Quantity  (ACQ)  of  each individual  coal  linkage  as  per  Fuel  Supply  Agreement  is  to  be  aggregated  as consolidated  ACQ  for  each  State  and  Company  owning  Central  Generating Stations instead of individual generating station. The State/Central Gencos have the flexibility to utilize their  coal in most efficient and cost effective manner in their  own  power  plants  as  well  as  by  transferring  coal  to  other  State/Central Gencos  Power  plants  for  generation  of  cheaper  power.  Thus,  the  State/Central Genco utilize their coal as per the efficiency of their plants.

.........2.

(b) to (d): As  per  the  methodology  for  use  of  coal  transferred  by  a  State  to Independent Power Producer (IPP) generating stations under flexibility in utilization of domestic coal for reducing the cost of power generation, the State can  divert  their  coal  and  take  equivalent  power  from  IPP  generating  stations selected from the competing IPPs through an e-bidding process.

The guiding principle of the methodology is that the landed cost of power from IPP generating station at the State's periphery should be lower than the variable cost of generation of the State generating station whose power is to be replaced by generation from IPP. The landed cost of power is inclusive of the transmission charges and transmission losses.

During the e-Bidding process for selection of IPP generating stations, a reference will be made by the State notified agency to the Ministry of Railways regarding  operational  feasibility  of  the  rail  transportation  of  coal  to  the  IPP generating station [shortlisted after opening of the Request for Quotation (RFQ) bids]. The details of the quantum of coal to be moved and the time frame during which this transportation is required would be conveyed to Traffic Transportation Directorate  of  Railway  Board  (Ministry  of  Railways)  by  the  concerned  State notified  agency.  Based  on  the  operational  considerations,  Ministry  of  Railways convey their consent or otherwise within 7 days of the receipt of the reference. The IPP, where the transfer of coal is not feasible as conveyed by the Railways, would not be eligible to participate in Request for Proposal (RFP) stage.

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