In news– The Ministry of Power has recently launched a scheme for Procurement of Aggregate Power of 4500 MW for five years under B (v) of SHAKTI Policy.
Key features of the scheme-
- The Ministry of Power has started this scheme on a competitive basis or five years on Finance, Own and Operate (FOO) basis under B (v) of SHAKTI Policy.
- PFC Consulting Limited (A wholly owned subsidiary of PFC Ltd) has been designated as the Nodal Agency by the Ministry of Power.
- Under the scheme, PFC Consulting Ltd has invited bids for the supply of 4,500 MW. Supply of electricity will commence from April 2023.
- The Ministry of Coal has been requested to allocate around 27 MTPA for this.
- It is for the first time that bidding is being carried out under B(v) of Shakti scheme. Also, revised PPA for medium term is being used in this bidding.
- This scheme is expected to help the states that are facing power shortage and also help generation plants to increase their capacities.
- The Ministry of Power had notified the Guidelines for procurement of power on Finance, Own and Operate (FOO) basis under para B (v) of the SHAKTI Policy on 25th October 2022.
- The methodology for coal allocation as per provisions of Para B (v) of SHAKTI policy was issued on 11th May, 2022.
What is SHAKTI policy?
- The SHAKTI (Scheme for Harnessing and Allocating Koyala Transparently in India) policy was approved in May 2017 with the intent of better allocation of coal to present and future power plants.
- It aimed to phase out the present Letter of Assurance and Fuel Supply Agreement (FSA)-based regime, and instead introduce a more transparent and competitive coal allocation policy.
- The policy also offered a potential solution to the lack of coal linkages to 17 power plants with a capacity of about 15,000 MW, which were part of the 34 power plants (of about 40,000 MW) declared as stressed.
- The policy was amended in March 2019 specifically to aid stressed projects based on the recommendations of a High-Level Empowered Committee.
Further reading: https://journalsofindia.com/shakti-policy/