Minimizing gap between ACS & ARR of Power generation is a priority, says Power Minister

The Government has taken various steps to minimize the difference between Average Cost of Supply (ACS) per unit of power and per unit average revenue realized (ARR) according to the information furnished by Shri Jyotiraditya Scindia, Minister of State (I/C) of Power in the Lok Sabha. These measures are as follows:-

• Promoting use of more efficient super-critical technology in thermal power generation with a view to reduce the cost of fuel required per unit of generation.
• Tariff Policy notified on 06.01.2006 mandates procurement of power by distribution licensees competitively except in cases of expansion of existing projects of where there is a State controlled/owned company as an identified developer.  For Public Sector projects also, the tariff of all new generation projects is to be decided on the basis of competitive bidding after 5th January, 2013.
• Improved operational norms in the tariff regulations issued by the Central Electricity Regulatory Commission (CERC) for the period 2009-14.
• Promotion of higher unit size/plant capacity to reduce capital cost on account of economy of scale.
• Revised mega power project policy issued by Ministry of Power in December, 2009 under which payment of custom duty is exempted for power generating equipments of certain specified capacity and excise duty is also exempted for certain categories of projects.
• Competitive tariffs have been discovered through tariff based competitive bidding for procurement of power for which the bidding documents have been provided by the Ministry.

  The details of ACS & ARR for the year 2009-10 to 2011-12 are given below:-