PowerMin bans NTPC from open market sale of electricity

Although the power ministry has filed an affidavit opposing Karnataka’s prohibition of power trading beyond their borders,the ministry has banned its own power generator,NTPC,from publicly selling electricity generated at two of its plants on the open market. With the support of the Central Electricity Regulatory commission,among the chief proponents of open access power trading,the ministry is maintaining that government public sector undertakings (PSU) should not be selling their product at a profit. “For Korba and Farakka,they have asked for permission to sell at the market price; we received the proposal last month and will take a call accordingly,” a power ministry official said under a condition of anonymity. Historically,the ministry has maintained that power generated by its maharatna power generator should be distributed with the intention of electrifying,not for profit.

NTPC chairman RS Sharma likened the PSU’s rights to any other power generator,while claiming his company’s rights to sell power at market prices according to the laws of open access drafted in the Electricity Act,2003. “If another company is not a PSU,do they not have to follow the laws of the land? That is not how it works,” Sharma told The Indian Express.

Former secretary H S Brahma had insisted that NTPC not should sell its power at a profit. NTPC has been trying to persuade the government to permit power transaction on the open market for Korba (Chhattisgarh) and Farakka (West Bengal). Korba maintains a power capacity of 2,100 mega watts with an additional 500 MW slated for commissioning in October. Farakka has a capacity of 1,600 MW while work is underway for an additional 500 MW. The 32,000 MW company had hoped to sell the new units as merchant power. “Open access is a mandate for transmission companies,they cannot stop the transmission of power,but if a generator does not want to sell,no one can make them,” said Alok Kumar,Secretary CERC. “Although NTPC is willing,it is the ministry’s decision. If the ministry does not want it,there’s nothing NTPC can do.” In early September,the Supreme Court will decide on the Karnataka State Electricity Board’s attempts at blocking the open trade of power in an effort to ensure that the units generated at home were consumed within the state and at a below market rate.