Network based systems

The Minister of Energy promulgates the 2021 electricity rules for easier access to the transmission network

The ministry had separated the Central Transmission Utility from POWERGRID to ensure transparency and a level playing field in transport offers and reduced the blocking period for transport projects to attract investment and more competition.

Union Energy Minister, Shri RK Singh

New Delhi: The Union Ministry of Energy has promulgated the 2021 Electricity Rules (transmission system planning, development and recovery of interstate transmission loads). Across the country.

At present, production companies request long-term access (LTA) on the basis of their supply agreements, while medium and short-term transport access is acquired within the available margins. Based on the LTA application, incremental transmission capability is added. A number of sectoral developments, such as the growing emphasis on renewable energy and the development of the market mechanism, have necessitated a review of the existing transport planning framework based on the LTA.

The rules underlie a system of transmission access called general network access in the interstate transmission system. This gives states as well as power plants the flexibility to acquire, hold and transfer transmission capacity as needed. Thus, the rules will bring rationality, accountability and fairness to the transport planning process as well as its costs. In a major change from the current system of access to transport, power plants will not have to specify their target beneficiaries. The rules will also allow state-owned electricity distribution and transmission companies to determine and build their transmission needs. In addition, states will be able to purchase electricity from short and medium term contracts and optimize their electricity purchase costs.

Besides the introduction of GNA, the rules also specify the clear roles of the various agencies involved in the transport planning process. The Central Electricity Authority shall prepare a short-term plan each year on a rolling basis for the next 5 years and a forward-looking plan each alternative year on a rolling basis for the next 10 years. The central transport service will prepare an implementation plan for the interstate transport network each year on a rolling basis for up to 5 years to come, which will take into account aspects such as the right-of-way and the progress of production and demand in various parts of the country. The rules specify how the existing LTA would be transformed into general network access. The rules also describe the recovery of RNG charges from transmission network users and assign responsibility for billing, collecting and disbursing interstate transport charges to the central transport service.

The rules made it possible, for the first time, for transmission capacity to be sold, shared or bought by states and producers. The rules provide that offtakes or injections in excess of the sanctioned RNG capacity will be billed at higher rates of at least 25%, which will ensure that entities do not under-report their RNG capacity. The Central Electricity Regulatory Commission (CERC) has been empowered to issue detailed regulations on RNG in the interstate transportation system.

The central government has notified these rules with a view to streamlining the process of planning, developing and recovering investment in the transport network. The rules aim to encourage investment in the production and transport sectors. The rules will allow the country to develop deeper markets.

The transmission system is the vital link in the electricity sector value chain connecting production and demand. The central government is committed to ensuring the adequacy of the transmission system for the supply of electricity from state to state and across regions. The rules decreed by the central government underline that “the planning of the transmission of electricity must be done in such a way that the lack of availability of the transmission network does not act as a brake on the growth of the different regions and the transmission network should, as far as possible, to be planned and developed according to the growth of generation and load and while doing the planning, care should be taken that there is no unnecessary investment ”.

In a series of other reforms carried out earlier, also on the instructions of the Union’s Minister of Electricity, Shri RK Singh, the ministry had separated the powerhouse from POWERGRID in order to ensure transparency and rules of the fair play in transport offers and reduce the blocking period of transport projects in order to attract investment and more competition. The Department of Energy has also issued rules on consumer rights, which empower consumers, and rules setting the ceiling for the surcharge for late payment.

Publication date : 04-10-21


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