Lok Sabha Question No. 568 (UNSTARRED), answered on 2018-12-13
Subject: Empowered Committee for Stressed Power Plants
Ministry: POWER
Asked by: DHARMENDRA YADAV, PRITAM GOPINATH MUNDE, S. RAJENDRAN, VIJAY KUMAR S.R., ANANDRAO  ADSUL, Shrirang Appa Barne, KUNWAR HARIBANSH SINGH, SHIVAJI ADHALRAO PATIL, SUDHEER GUPTA, T. RADHAKRISHNAN

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA UNSTARRED QUESTION NO.568

## TO BE ANSWERED ON 13.12.2018

## EMPOWERED COMMITTEE FOR STRESSED POWER PLANTS

†568.   SHRI DHARMENDRA YADAV:

DR. PRITAM GOPINATH MUNDE:

SHRI S. RAJENDRAN:

SHRI S.R. VIJAYAKUMAR:

SHRI ANANDRAO ADSUL:

SHRI SHRIRANG APPA BARNE:

KUNWAR HARIBANSH SINGH:

SHRI ADHALRAO PATIL SHIVAJIRAO:

SHRI SUDHEER GUPTA:

SHRI T. RADHAKRISHNAN:

Will the Minister of POWER be pleased to state:

(a) whether  the  empowered  Committee  headed  by  Cabinet  Secretary suggested  policy  measures  to  revive  stressed  power  plants  with  improved coal availability and if so, details of the main recommendations made by the aforesaid Committee;

(b) whether some of the recommendations are for allowing coal linkage for short-term  contracts  or  bill  discounting  mechanism  to  address  overdue payments;

- (c) if so, the steps taken by the Central Government  of  India for implementation of the recommendations/ suggestions made by the aforesaid Committee;

(d) whether  aforesaid  Committee  suggested  reserving  60%  of  coal  spot auctions  for  power  plants,  change  in  coal  allocation  policy  to  offer  future incremental  coal  without  auction  to  PPA  holders  and  offering  more  coal  to efficient plants; and

- (e) if so, the action taken by the Government in this regard?

## A N S W E R

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

( SHRI  R. K. SINGH )

(a), (b) & (d) :  Yes, Madam.

The High Level Empowered Committee (HLEC) has made following recommendations in their report:

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1. Recommendations for Coal allocation/supply
2. 1.1. Coal Linkage for short-term PPA: Linkage coal may be allowed to be used against short term PPAs and power be sold through Discovery of Efficient  Energy  Price  (DEEP)  portal  following  a  transparent  bidding process.
3. 1.2. Coal Supply in case of termination of PPAs due to Payment default by DISCOMs:  A  generator  should  be  able  to  terminate  PPA  in  case  of default  in  payment  from  the  DISCOM  with  the  facility  to  use  linkage coal for short term PPAs for a period of maximum of 2 years or until they  find  another  buyer  of  power  under  long/medium  term  PPA, whichever is earlier.
4. 1.3. Procurement  of  bulk  power  by  a  nodal  agency  against  pre-declared linkages: A nodal agency may be designated which may invite bids for procurement  of  bulk  power  for  medium  term  for  3  to  5  years  in appropriate  tranches,  against  pre  declared  linkage  by  Coal  India Limited (CIL).
5. 1.4. PSU to act as an aggregator of power: NTPC can act as an aggregator of power, i.e., procure power through transparent competitive bidding process from such stressed power plants and offer that power to the DISCOMs  against  PPAs  of  NTPC  till  such  time  as  NTPC's  own concerned plants/units are commissioned.
6. 1.5. Increase  in  quantity  of  coal  for  special  forward  e-auction  for  power sector: Ministry Of Coal may earmark for power, at least 60 per cent of the e-auction coal, and this should be in addition to the regular coal requirement of the power sector.
7. 1.6. Linkage to be provided at notified prices without bidding: The generator should be required to bid only once, for the procurement of PPA and linkage should be granted at notified price without any further bidding, to the extent of incremental coal production.
8. 1.7. Non-accrual  of  short  supplies  of  coal:  If  there  is  a  shortfall  in  the supply of coal and it is attributable to the Ministry of Coal or Railways; such shortfall  need  not  lapse  and  be  carried  over  to  the  subsequent months up to a maximum of three months.
9. 1.8. ACQ  to  be  determined  based  on  efficiency:  Upper  ceiling  for  the ACQ/MW  may  be  prescribed  by  the  CEA  on  the  basis  of  efficiency parameters and irrespective of the capacity and actual consumption of that plant, the coal may be supplied on that basis.
2. Recommendations to facilitate sale of power of the stressed power plants
11. 2.1. Retirement of old and inefficient Plants: Old and high heat rate plants not  complying  with  new  environment  norms  may  be  considered  for retirement  in  a  phased  and  time  bound  manner  at  the  same  time avoiding any demand/supply mismatch.

……….3.

3. Recommendations on Regulatory & DISCOM payment issues:
2. 3.1. Mandatory  payment  of  Late  Payment  Surcharge  (LPS):  Late  Payment Surcharge be mandatorily paid in the event of delay in payment by the DISCOM.
3. 3.2. Payment Security mechanism for IPPs: PFIs providing the Bill Discounting facility may also be covered by TPA i.e. in case of default by  the  DISCOM,  the  RBI  may  recover  the  dues  from  the  account  of States and make payment to the PFIs.
4. Other Recommendations
5. 4.1. Cancellation  of  PPA/FSA/LTOA  post  NCLT  scenario:  PPAs,  FSA  and LTOA  for  transmission  of  power,  EC/FC  clearances,  and  all  other approvals  including  water,  be  kept  alive  and  not  cancelled  by  the respective  agencies  even  if  the  project  is  referred  to  NCLT  or  is acquired by any other entity. All of these may be linked to the plant and not the Promoter.
6. 4.2. Cancellation  of  PPA  for  non-compliance  of  COD:  In  case  there  is  a delay in the commissioning of a project, the DISCOMs may be advised not  to  cancel  the  PPAs  signed  with  the  Generator  and  the  same  be kept on hold for a certain period of time.
7. 4.3. Low utilization of Gas plant capacity due to paucity of natural gas: In order to revive gas based power plants, Ministry of Power and Ministry of Petroleum & Natural Gas may jointly devise a scheme in line with the earlier e-bid RLNG Scheme (supported by PSDF).
8. (c) & (e) : Report has been circulated by the Government to all members. It has also been published on the website of the Ministry.

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