Power utilities can save up to Rs 20,000 crore through improved scheduling: Piyush Goyal


Power, coal, renewable energy and mines minister Piyush Goyal today launched an app that provides information on availability of cheaper electricity to state power utilities allowing improved scheduling and optimum utilization of coal.

The app named Merit Order Despatch of Electricity for Rejuvenation of Income and Transparency (MERIT) can help distribution utilities achieve savings of upto Rs 20,000 crore annually, Goyal said. “With 1,20,000 crore units of electricity being consumed in the country now, which will go up to 2 lakh crore units in five years, this app, at a conservative estimate, can help save 10 paise per unit…which makes for a straight saving of Rs 20,000 crore a year for discoms,” news agency IANS quoted Goyal as saying.

The app has been developed by the power ministry in association with POSOCO and Central Electricity Authority (CEA). The app is designed to display information regarding the merit order which includes daily state-wise marginal variable costs of all generators, daily source-wise power purchases of respective states with source-wise fixed and variable costs, energy volumes and purchase prices.

“The initiatives launched today will reflect a government in action fulfilling the promises made to the people of India. It also provides an opportunity to the people and the media to monitor our work and keep questioning what is happening in the power sector,” Goyal said at the launch.

The electricity tariff Policy of 2016 mandates the state discoms to follow the merit order for procurement of power and provides that there should be uniformity in the merit order mechanism.

“Most states follow merit order operation. However, details in this regard need to be made transparently available. Hence, there was a need to have a mechanism to quantify deviation from merit order and check its reasonableness. The adherence to merit order optimizes the power procurement cost and benefits both utility and ultimate consumer,” the ministry said in a statement.

Goyal also launched an e-bidding portal that aims to facilitate states in inviting bids for procurement of power from the prospective Independent Power Producers (IPPs) in a transparent manner by transferring their domestic coal under the scheme of flexibility in utilization of domestic coal.

“Few years back, when coal linkage rationalisation was undertaken, it led to huge savings. This portal is again going to bring in improvement in savings. It will also provide flexibility in a transparent method of buying power,” power secretary Ajay Kumar Bhalla said.

The portal has been jointly developed by the ministry of power, along with PFC consulting Ltd and MSTC Ltd. The successful bidder on the app will be selected through the e-reverse bidding process.

Source: 5 July 2017. Power utilities can save up to Rs 20,000 crore through improved scheduling: Piyush Goyal