The Ministry of Power (MoP) has directed that priority will be given for allocation of power from unallocated quota to states/union territories (UTs) which adhere to financial discipline and refrain from imposition of tax/duties on flow of power to other states.
Notably, MoP allocates power generation capacity to states from time to time from its pool of unallocated quota in central generating stations. Accordingly, whenever a request is received from a state/UT for allocation of power from unallocated quota of central generating stations, it has decided that various aspects would be examined including, non creation of regulatory assets; timely payment of subsidy declared, if any, in the consumer tariffs by the state government to distribution utilities; and whether any tax/cess has been imposed by the state concerned particulary on hydro power or on renewable energy projects which has the potential to obstruct inter-state flow of electricity. Allocation of power to a state/UT will be disincentivised if it is found violative in any of these criteria.