CERC caps energy exchange power price at ₹12 per unit

Regulatory commission’s order comes after the then UP energy minister Shrikant Sharma urged the Centre to put a ceiling on the maximum price of the power that energy exchanges sold to states

LUCKNOW : In a development that is expected to benefit the UP Power Corporation Ltd (UPPCL) and its consumers, the Central Electricity Regulatory Commission (CERC) has capped the cost of power to be sold by energy exchanges at Rs 12 per unit, people aware of the issue said.

The UPPCL had to buy power from the energy exchanges at a price as high as Rs 20 per unit during the nationwide coal crisis in September-October last year. “Commission in exercise of powers under Regulation 51 (1) of PMR 2021 directs the power exchanges until further orders, to re-design, with immediate effect, the bidding software in such a way that members can submit their bids in the price range of Rs0/kWh to Rs12/ kWh,” the CERC said in its order on April 1.

The commission noted that such abnormally high price (Rs 20 per unit), even for a short period, without any significant impact on increase in supply was not only against consumer interest but also eroded the buyer’s confidence in the market’s credibility. The CERC’s order comes after the then Uttar Pradesh energy minister Shrikant Sharma took up the issue with the Centre urging it to put a ceiling on the maximum price of the power that energy exchanges sold to states.

Sharma wrote a detailed letter to the Union power minister in October 2021 following a representation by UP Rajya Vidyut Upbhokta Parishad chairman and state advisory member Avdhesh Kumar Verma who demanded a price ceiling while accusing energy exchanges of indulging in profiteering during the crisis. “We welcome the CERC order though we still feel that the electricity price cannot be more than Rs 6 per unit and we will continue our fight,” said Verma, who on Saturday met the then energy minister Shrikant Sharma and also called up Union power secretary Alok Kumar expressing gratitude to them for their efforts for getting the electricity price capped.

THE UPPCL HAD TO BUY POWER FROM THE ENERGY EXCHANGES AT A PRICE AS HIGH AS RS 20 PER UNIT DURING THE COAL CRISIS LAST YEAR