Amid Bangladesh crisis, Centre eases norms for power exporters

The Union ministry of power has amended the norms to widen the sources of coal for generating power for the purpose of exports and to help generating companies avert losses in case of payment default by neighbouring countries.

So far, power generated from coal procured through e-auction, commercial mines and imports was allowed to be exported.

"Export of electricity from India by a generating company/distribution licensee directly or through trading licensee shall be allowed only if such electricity is generated utilizing imported coal or spot e-auction coal or coal obtained from commercial mining or from any other source as specified by the Government of India from time to time; provided that such restrictions shall not be applicable for collective transactions through power exchange(s) in India," said notification dated 12 August. 

The move comes at a time when the demand for coal has been tapering. On Tuesday, state-run Coal India also decided to supply more coal to power plants than their annual contracted quantities (ACQs).

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In another major move, the power ministry notification has allowed export-focused power plants to sell their power within the country in case of payment defaults under power purchase agreements (PPA). Adani Power would be a key beneficiary of this easing of norms as it is the only exclusive electricity provider to the crisis-hit Bangladesh.

Currently, Adani Group's 1,600 megawatts (MW) plant in Godda, Jharkhand, sells electricity exclusively to Bangladesh. The PPA for the power supply was signed between its arm Adani Power (Jharkhand) and Bangladesh Power Development Board (BPDB). The plant currently sources coal from the Adani Group's mines in Australia.

"Indian generating station(s) supplying electricity exclusively to neighbouring country may be allowed to build dedicated transmission line for connecting to the transmission system of neighbouring country keeping in view technical and strategic considerations. Provided further that the Government of India may permit connection of such generating station to the Indian Grid (inter-state or intra-state grid) to facilitate sale of power within India in case of sustained non-scheduling of full or part capacity or default notice issued by the generator for any default including delayed payment under the PPA," the notification said.

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After Sheikh Hasina resigned as the prime minister of Bangladesh and the country went into further turmoil, Adani Power told Mint the BPDB is scheduling the power supply to meet their demand and Adani Power continues to supply power to the Bangladesh utility without any disruption. "Going forward too, we will remain guided by the BPDB’s schedule and as per the provisions of the PPA between two utilities," said a company spokesperson.

"The said amendment is merely an industry enabling universal provision allowing such generating stations to obtain connectivity to the Indian grid, and as such in no way imposes any financial or other obligation on the Govt. of India to purchase the power from such generating station. By connecting such generating stations to the Indian grid, the overall availability of power in the grid will increase, which will help cater to the soaring electricity demand across the country," said Adani Power on Mint's query on the latest notification.  

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Queries sent to the ministry of power and the BPDB remained unanswered till the story was published.