CERC proposes deterrent charges for low coal stocks at power plants

The Central Electricity Regulatory Commission (CERC) has floated a staff paper on the methodology for computing deterrent charges for maintaining lower coal stock by coal based thermal generating stations.

The proposal is based on a direction issued by the union power ministry in February 2022 under Section 107 of the Electricity Act, 2003 to provide for disincentives for maintaining lower cost stock by the thermal generating stations. In its proposal, the CERC has argued that in order to recover full annual fixed charges, it is the obligation of the power generating company to arrange sufficient coal stock for its generating stations as per norms and maintain the availability of the plant as per the relevant regulations.Therefore, the CERChas proposed that if coal based generating stations fail to maintain coal stock as per the revised coal stocking norms as specified by the Central Elctricity Authority(CEA), theannual fixed cost (AFC) of such generating stations be reduced.The paper has proposed methodologies for the calculation of deterrent charges for power stations based on domestic coal as well asfor those based on imported coal. The stakeholder comments have been sought latest by May 27, 2022.


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