World Bank Wants Ntpc Tariff Linked To Power Availability

Although NTPC should be supplying bulk power to the grid on a two-part tariff basis, separating fixed and variable costs, this norm is being flouted with impunity.

According to government guidelines, regional electricity boards and load despatch centres have been charging fixed expenses from state electricity boards (SEBs) on the basis of actual drawals of NTPC power.

This, according to the World Bank, effectively converts NTPC tariffs back to the operationally inefficient and contractually incorrect single-part tariff system.

The Bank also realises that the government will face difficulties in implementing availabilty-based tariffs.

It has observed that the National Task Force (NTF), which was to implement an earlier ECC report on availability of tariffs, would find it difficult to have availability-based tariffs negotiated between NTPC and the SEBs.

 

The Bank has expressed fears that the negotiated tariff may not be ready for

implementation by the time NTPCs current bulk power supply aggrements expire in 1997-1998.

It has, however, argued that NTPC would benefit more from availability-based tariffs than from the current pattern.

NTPC plants, which are pit-head based and more efficient than other state electricity board plants, should be despatched high in the merit-order as their variable costs are among the lowest in the country, the Bank has explained

It has noted that the low variable costs of NTPC stations can be measured only when the variable and fixed costs are properly separated.

Until this is done, the SEBs would find it more economical to run their own plants over NTPC plants.

Once the question of who should back down is settled through the introduction of availability tariffs, NTPC stations would fill in the base-load