Tender to facilitate purchase of 4000 MW gas-based power soon, ET EnergyWorld

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New Delhi: The power ministry plans to float a tender to facilitate procurement of 4,000 MW gas-based electricity for around 20 days between September and November to methe rising demand and get the stress off coal-based units.

The ministry has appointed NTPC Vidyut Vyapar Nigam Ltd (NVVN) as the agency to facilitate the purchase from generating companies and sell in the high-price day-ahead market and term-head market, people aware of the development told ET.

This will be over state-owned NTPC Ltd‘s gas-based power capacities, they said.

With this tender, availability of gas-based electricity capacity will go over 10,000 MW when needed, one of the sources said.

Such an arrangement comes with a minimum offtake guarantee by NVVN, an NTPC subsidiary.

In case the power is not sold in the markets, the offtake can be lined up through the tertiary reserve ancillary services mechanism.

Ancillary services, here, mean those which immediately come into service with a sudden change in frequency.

The move comes on the backdrop of rising electricity demand from mid-August when peak demand reached record highs and coal stocks at power plants started depleting at a much faster pace.

Coal stocks at power plants fell over 6 million tonnes since August beginning to 28.4 million tonnes as on September 4. The stocks are likely to deplete further, and September may end with 23 mt of coal stocks, a government official said.

The power ministry in a recent order asked power plants to import 4% of their coal requirement till March as against till September. It also asked imported coal-based power plants to further run at optimal capacity till October.

The ministry had made a similar move in April in anticipation of higher demand in summer to avoid pressure on domestic coal and its transport. Gas-based power is generally more expensive and is sought only when demand is high.

Peak electricity demand hit a high of 240 GW on September 1, and has mostly been over 200 GW on the back of irrigation needs with deficient rainfall in monsoon and sultry weather.

  • Published On Sep 8, 2023 at 08:38 AM IST

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