|
Monday August 17, 11:00 AM
|
|
Power min mulls cap on sale price of merchant power - paper
MUMBAI (Reuters) - The power ministry is planning to cap sale price of electricity sold in the open market or merchant power, if the projects claim tax benefits, The Economic Times reported on Monday, quoting an unnamed official.
Power projects sign long-term power purchase agreements (PPA) with buyers for a bulk of the power produced, but can sell the balance in the open market, which is called merchant power.
The premium charged on such power sales can be as high as 15 rupees a unit, while rates under PPA range between 1.20-3.50 rupees a unit, the paper said.
The government is trying to prevent power companies from making windfall gains while enjoying the tax benefits, the Economic Times quoted a power ministry official as saying.
The cap could be 5-7 rupees a unit, the paper reported.
