Chennai, Dec. 9Third-party sale of power by captive generating units is closer to implementation with the Tamil Nadu Electricity Regulatory Commission (TNERC) permitting the Tamil Nadu Electricity Board to relinquish the right to collect cross-subsidy surcharge.

According to officials sources, the regulatory commission has approved TNEB’s petition on Friday.

Industry sources said that the order paves the way for implementation of the intra-State open access, which enables a captive power generator to sell power to a third party after paying wheeling charges for using TNEB’s transmission infrastructure. Captive power generating units can now sell power to a third party under the intra-State open access without paying cross-subsidy surcharge to TNEB.

Apart from the wheeling charges, the power generators have to pay the cross-subsidy surcharge of 90-95 paise a unit, which would affect the viability of the transaction.

Following a shortage of over 1,600 MW of power in the State, TNEB recently obtained the regulatory commission’s clearance for allowing third-party sale of power to exploit the power capacity available with captive power generation units. This had evoked the interest of major industrial units, which have offered their surplus power to industrial consumers facing electricity shortage.

Biomass power producers have also welcomed the order as they soon expect to start third party sale of power once TNEB completes the paper work. Over 120 MW of power that is lying idle because of the unviable power tariff paid by the electricity board would soon come into supply.

TNEB pays Rs 3.15 a unit against Rs 7 the biomass power producers expect to make from the market. TNEB tariff is unviable and the units are lying idle. A separate petition for TNEB to revise the tariff is pending with TNERC, industry sources said.

Source : Business Line