Lagatar24 Desk
New Delhi, Oct.23: The Ministry of Power on Saturday, issued new guidelines to ensure the sector’s economic viability, reduce financial stress among diverse stakeholders, and assure timely recovery of energy producing expenses.
In order to satisfy India’s commitment to climate change, the ministry published guidelines for the long-term viability of the electrical sector and the promotion of clean energy, according to a statement.
Investors and other power industry stakeholders had been concerned about the timely recovery of expenses due to changes in the law, renewable power curtailment, and other related issues.
It went on to say that the rules notified by the Ministry of Power under the Electricity Act of 2003 are in the best interests of electricity customers and stakeholders.
The rules include Electricity (Timely recovery of costs due to Change in Law) Rules, 2021. The other rule is Electricity (Promotion of generation from renewable sources of energy by addressing Must Run and other matters) Rules, 2021
The ministry said that quick recovery of expenditures incurred as a result of a change in law is critical because investment in the power sector is heavily reliant on timely payments.
“At present, the pass through under change of law takes time. This impacts the viability of the sector and the developers get financially stressed. The rules would help in creating investment friendly environment in the country,” it stated.
The ministry said, “The energy transition is happening across the globe. India has also made commitments to bring about energy transition. India has also announced international commitment to set up 175 GW of RE capacity by 2022 and 450 GW by 2030.”
According to the government, new rules would aid in meeting the RE generation targets. This will ensure that consumers have access to green, clean energy while also ensuring a healthy environment for future generations. A method has been supplied to compute the monthly tariff adjustment owing to the impact of a legal change.
The guidelines also provide that a must-run power plant’s generation or supply of electricity cannot be curtailed or regulated due to merit order dispatch or any other commercial motive.
Only in the case of a technical restriction in the energy grid or for reasons of grid security may electricity output from a must-run power plant be limited or regulated.
The provisions of the Indian Electricity Grid Code must be observed for power curtailment or regulation.
In the event that a must-run power plant’s supply is curtailed, the procurer must compensate the must-run power plant at the rates stipulated in the agreement for the purchase or supply of electricity.
The RE generator may also sell power on the power exchange and recoup its costs appropriately. This aids in the generation of money for the generator, as well as the availability of power in the electricity system for usage by customers.
