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In a move that would benefit only bulk consumers of power, the Union government is giving shape to the open access system of power, which it has been working on for some years now. The government is preparing detailed guidelines for smooth functioning of the open access system, which will enable power producers to sell electricity to the most creditworthy buyer. According to an internal note prepared of the ministry of power, the government plans to develop an index in the form of a matrix to reward the states facilitating open access. Since the proposed central unallocated power to be offered for incentivising open access is limited, it will be considered as a separate pool and will be distributed irrespective of the region from where it originates.

Though some states have allowed open access in a limited way but largely power producers can sell power only to state electricity boards, which are often not creditworthy. The new guidelines would also help bulk consumers to choose a power producer. Besides, by offering incentives to states for its adoption, it will give a push to the open access system.

At present, a power company like NTPC has to compulsorily sell about 14% of the power produced in the state where it is located. The balance, theoretically, can be put on the grid to be offered to whoever bids the maximum. Though some states allow open access, it's not really encouraged by the Centre as a surcharge is often added on this sale. The new system seeks to incentivise this process of sale of excess power.

Additionally, to support the National Solar Mission, as per a cabinet decision on November 19, 2009, the availability of central unallocated power for incentivising open access has been worked out after deducting the maximum anticipated allocation of 1,000 MW to NTPC Vidyut Vyapar Nigam (NVVN) from the central unallocated power of NTPC. NVVN is the power trading arm of NTPC.

Currently, the central unallocated power is 5,000 MW in a region. It may be pointed out that the ministry of power recently committed to allot, out of the Centre's discretionary quota, an equivalent wattage to MVNN to match purchase of solar power.

The note was prepared for the cabinet after several rounds of meetings on the issue between an inter-ministerial task force set up for the purpose under the chairmanship of B K Chaturvedi, member (power), Planning Commission and the empowered sub-committee on infrastructure over the last couple of years. Several inter-ministerial consultations have also taken place during this period. In fact, the ministry of power is at loggerheads with some of the suggestions on open access recommended by the task force.


Source- Times of India