The Maharashtra Electricity Regulatory Commission (MERC) has turned down Tata Power’s demand for permission to use a 40-megawatt generation unit at Lodhivali in Khopoli for standby power for Mumbai.
This decision is likely to spare consumers higher electricity bills as a result of buying power at a higher rate to ensure uninterrupted supply.
In addition to the existing system, which ensures extra supply of 500MW for the city in case of outages, Tata Power had asked to be allowed to use a 40MW standby support exclusively for itself and island city supplier BEST, to which it sells electricity.
The company had said that this standby was essential to avoid load-shedding in Mumbai in case any of the contracted generating units fail to supply adequate quantum of power to meet the city’s growing needs.
To ensure uninterrupted power supply in case of emergency, state company Mahavitaran is contracted to supply up to 500MW to all companies. Other than this, Tata and BEST are contracted to get 2,000MW daily.
Reliance gets another 800MW to 1,000MW to the city.
The Lodhivali unit could be brought on line quickly and could generate its maximum output in about 15 minutes, the firm said.
Industry experts said electricity from Lodhivali could cost more than the existing contracted supply as it would be generated using diesel, gas or oil.
To reduce such costs, Tata Power had proposed converting its gas/oil-fired 500MW unit in Trombay to the less expensive coal.
In its recent order, MERC said the existing arrangement of availing of standby from the state-owned Mahavitaran — all three private companies pay Mahavitaran a fixed cost of Rs396 crore annually for availing of standby facility of up to 500 MW – was adequate.
When Tata Power argued that i t wo u l d require a standby requirement of 244MW as against the available capacity of 177MW, the regulator disposed of the petition saying that Mahavitaran was ready to provide additional standby power to the city in the future.