Standard Post with Image

Private Players Opposes Government's Move to Cloister PSUs from Bidding Procedures

<p><span style="font-size:9.0pt">The Tariff Policy, 2006 had stated that all future requirement of power will be procured through competitive bidding. This was to make the sector more efficient and provide consumers with the cheapest power possible.</span></p> <p><span style="font-size:9pt">Recent Draft amendment floated by Ministry of Power had isolated PSU from competitive bidding procedures and have provided an edge to NTPC to sell power at cost plus tariff. Private Players have raised concern on the amendment as this would not provide a level playing field to all by making competitive bidding biased. And would impede development of power market and different market products therein which can serve the diverse needs of power by different consumer categories.</span></p> <p><span style="font-size:9pt">Private Players alleged that they have to bid for both power purchase agreements and coal on priority bases, whereas PSU shall stand surpassed.</span></p> <p><span style="font-size:9pt">Private power companies have been reeling under the pressure due to lack of power purchase agreements, low capacity utilisation on one hand and with mounting losses as huge debt on the other. Such biased market will plague market dynamics and would end up with consumers paying high cost of electricity. This would defy objective of Tariff policy to provide electricity at affordable tariff to all.</span></p>