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Legal Central Ministry of Power Electricity Act, 2003

Ministry of Power issues Clarification on the Revised Policy for Biomass Utilization for Power Generation through Co-firing in Coal Based Power Plants

14-May-2024 | F. No.11/86/2O17-Th.II (C.No 238797)

The Ministry of Power has issued a Clarification on the Revised Policy for Biomass Utilization for Power Generation through Co-firing in Coal Based Power Plants, effective from 14th May, 2024.

By virtue of this Clarification, the Ministry clarifies that the cost of biomass pellets can be passed through in the Energy Charge Rate (ECR) for power plants with fuel cost pass-through provisions in their Power Purchase Agreements (PPAs) signed under Section 63 of the Electricity Act, 2003. Previously, there was ambiguity regarding the applicability of change in law provisions for cost increase due to biomass co-firing in such PPAs.

This clarification addresses concerns raised by power plants about recouping the additional costs associated with using biomass pellets for co-firing.

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