Delhi doesn’t want power from Dadri plant, says regulator

BSES claimed that it had to pay fixed charges of about Rs 35 crore per month to the Dadri-1 plant even if it didn’t source electricity from the unit.

The Delhi Electricity Regulatory Commission (DERC), the power regulator of the state, has written to the Union power ministry requesting “to permanently reallocate on urgent basis” Delhi’s share of electricity from NTPC’s Dadri-I generating station.

The effective cost of power from the Dadri-I plant comes to Rs 6.50/ unit, making it one of the costliest power stations providing electricity to the National Capital Region.

Delhi consumes 756 mega-watt power from the Dadri-1 plant, comprising 90% of the unit’s total capacity. Since the Dadri-I station completed 25 years of operation in November 2020, as per the Central Electricity Regulatory Commission’s (CERC) 2019 tariff regulations, electricity distribution companies (discoms) have the “first right of refusal” for procuring electricity from old power plants.

BSES, in November 2020, had sought to stop taking power from the Dadri-I generating station from December 1, 2020. BSES claimed that it had to pay fixed charges of about Rs 35 crore per month to the Dadri-1 plant even if it didn’t source electricity from the unit.

According to the letter dated July 7, reviewed by FE, the DERC has requested the ministry to reallocate its share of power from the plant “to other needy states with effect from December 1, 2020 to avoid the burden of fixed cost without any power scheduled to end consumers of Delhi”.

Under contractual requirements, discoms have to continue paying fixed cost to thermal power plants to recover the projects’ capital expenditure and cover debt obligations even when they do not procure electricity. According to a recent report by Forum of Regulators, discoms in 12 states cumulatively pay a hefty Rs 17,500 crore a year to generators for the power they don’t use.