The government has decided not to bring any new policy to provide support to gas-based power plants at the moment because states are reluctant to offer certain concessions for these projects. To revive and improve utilisation of gas-based capacity in the country, the Government of India had sanctioned a scheme of e-RLNG (e-auction of Re-gasified Liquefied Natural Gas) for utilisation of gas-based power generation capacity during the years 2015-16 and 2016-17. The scheme envisaged supply of imported spot RLNG to the stranded gas-based plants as well as plants receiving domestic gas, selected through a reverse e-bidding process.
The scheme also envisaged waivers and concessions to be made collectively by all stakeholders including state governments and support from Power System Development Fund (PSDF). The scheme ended on March 31, 2017.
“In the light of the reluctance of the states to give any waiver/concession, and the fact that gas-based power generation grew without any support, it was decided that there may not be any need to have any policy on providing support to the gas-based power plants at the moment. The proposal to revive e-RLNG scheme to provide support to the gas based plants was examined. The views of the state regarding waivers and concessions of State Government taxes and levies were sought. State governments expressed their views that the proposed concessions/waivers for the revival of gas based plants are not feasible/viable in the current scenarios and they are not in favour of exemption of goods and services tax (GST) on transportation of the scheme gas” said Power Minister R K Singh.
Further, the minister explained that the gas prices were in the falling trend since last year and in 2019-20 the plant load factor (PLF or capacity utilisation) of gas based power generating stations was 22.15% and until August 2020, despite lower demand due to COVID-19, the PLF of gas-based power plants had risen to 26.64%. This has happened without any support due to lower LNG price.
