Gujarat bans sourcing power from other states

Gujarat government has recently banned its state distribution companies from buying power from other states. These discoms will now have to procure power from state power generators.

Power procurement from state power generators means industries will now have to shell out more money from their pockets. The increase of Rs. 2.75 per unit is expected, taking the net power cost per unit touching Rs. 7.

As per an article in Economic Times, industries in Gujarat route around 1000 MW from other states via power exchanges while 2500 MW of state power generation companies are sitting idle.

GETCO; state transmission company has written letters to 125 industries, quoting the following:

“Due to rise in the system load demand, leading to grid constraint in the upstream network, it shall not be feasible to permit short-term open access to consumers as per enclosed list with effect from March 20,”

The decision has also taken into consideration the intent to reduce solar power tariff in the state. The state is said to have tied up for 950 MW at a higher solar tariff as against the requirement of 350 MW under solar obligation.

Aggrieved by the move, which is seriously questioning the viability, the industries association of the state are going to give a presentation to the govt. in the coming days.

An article in Economic Times can be accessed here.