Cap power prices at energy exchanges: AIPEF

All India Power Engineers Federation on Tuesday demanded an immediate meeting of Forum of Regulators to cap power prices at energy exchanges, alleging black marketing by private operators during the ongoing coal shortage crisis.

"All India Power Engineers Federation (AIPEF) has demanded that a meeting of the Forum of Regulators be held immediately to stop black marketing in energy exchanges mostly by private operators during the crisis. AIPEF has also demanded that Expert Committee be constituted to fix responsibility for the Coal Crisis and to evolve ways and means to avoid such crises in future," an AIPEF statement said.

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AIPEF Chairman Shailendra Dubey has in a letter to Union Power Minister RK Singh urged that the subject of putting a cap on profiteering by IPPs (independent power producers) may be discussed and finalised in the Forum of Regulators in letter and spirit of section 62 (1) of the Electricity Act 2003 immediately to stop black marketing in energy exchange, mostly by private operators during the crisis.

The AIPEF letter said that since coal shortage is recognised as a major factor causing a hike in power rates, the Power Ministry must stress for ending future coal shortages otherwise the results of 2021 would repeat. In particular, we refer to an interview by the then Coal Secretary GOI (Anil Swarup) in 2016, when he said that an action plan would be finalised over the next 5 years for meeting coal shortages.

However, this action plan was not implemented and now the Coal Secretary has retired, and it is up to the Ministry of Power to take up the issue of coal shortages with concerned ministries.

AIPEF also demanded that one expert committee with a CEA member should be constituted immediately to enquire about the coal shortage resulting in the power crisis so that the reason for the present crisis is technically analysed and stern action is taken against those responsible for the crisis.

The AIPEF letter also said as the coal shortage leading to a spike in energy rates, it was necessary for state regulators as well as CERC to intervene and impose price caps to prevent excessive profiteering by IPPs and also to ensure that unbearable burden is not put on consumers of Discoms.

Discoms are constrained to purchase high-cost power to limit the power cuts, it added.

This leads to a deterioration of Discom finances, which are already stressed. From this angle also, price caps on merchant power plants are required, and the present instances of exploiting shortage by raising the rates to the range of Rs 20 per unit in energy exchange must not be allowed. As per sec 62 (1) of the Electricity Act 2003, it becomes the duty of the Regulator to impose price caps, according to the letter.

AIPEF has also expressed its concern about the closure of ultra-mega power plants of Tata and Adani at Mundra, which are run by imported coal and have nothing to do with the present coal crisis. PTI