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Legal Gujarat Ministry of Power Electricity Act, 2003

Directions to Imported Coal-Based Power Plants to Operate at Full Capacity

22-Mar-2026 | No. 23/13/2021-R&R (Pt-1)

The Ministry of Power (MoP) has issued directions under Section 11 of the Electricity Act, 2003, mandating Imported Coal-Based (ICB) power plants-specifically Coastal Gujarat Power Ltd. (CGPL), to operate at full capacity to meet the anticipated rise in electricity demand. A committee comprising representatives from MoP, CEA, and NTPC will determine benchmark power tariffs, ensuring coverage of imported coal costs, shipping, O&M expenses, and a reasonable margin. Power will primarily be supplied to existing PPA holders, who may opt for either the benchmark tariff or mutually agreed rates. Any surplus or unscheduled power will be sold through power exchanges. Key provisions include:

1. Flexible scheduling: Power not requisitioned by DISCOMs may be offered to others or sold in exchanges.
2. Profit sharing: Net gains from power sold in exchanges (instead of PPA supply) will be shared 50:50 between generators and procurers.
3. Payment security: Mandatory Letter of Credit (LC) or advance payment; failure allows generators to sell power in exchanges.
4. Weekly payments & reporting: Procurers must pay weekly; generators must report weekly to MoP.
5. Coal stock compliance: Plants must maintain adequate coal inventory for full-capacity operation.
6. No penalties: Procurers cannot impose penalties if plants comply with Section 11 directions.

The Energy Charge Rate (ECR) will be calculated based on the lowest of indexed coal cost, adjusted cost (excluding mining profit), or actual cost. Benchmark tariffs will be reviewed every 15 days to reflect market changes. These directions are effective from 1 April 2026 to 30 June 2026, and may be extended to other plants if required. Non-compliance may attract penalties under the Electricity Act, 2003.

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