Proposal for rationalization of Unscheduled Interchange (UI) price vector Section-A: Background

POWERGRID
Proposal for rationalization of Unscheduled Interchange (UI) price vector
Section-A:
Background
1. Honorable CERC, in its order dated 15th January 2007 in the petition 145/2006
had directed ED (SO & NRLDC), POWERGRID to deliberate the issue of
enhancement of the Unscheduled Interchange (UI) prices in consultation with the
RLDCs and SLDCs and submit a consolidated proposal to the Commission by
25th January 2007.
2. Northern Regional Load Despatch Centre (NRLDC) had earlier submitted petition
no. 4/2006 on 13th January 2006 for review of frequency linked UI price vector
and implementation of a payment security mechanism for UI charges.
Subsequently on the Commission’s direction vide letter dated 27th January 2006,
a detailed proposal on this issue was submitted on 01st March 2006. A copy of
this was also forwarded to the stakeholders on 13th March 2006 as directed by
the CERC vide their letter dated 08th March 2006.
3. The benefits that would accrue on implementation of the NRLDC’s proposal in
petition no. 4/2006 as enumerated in the proposal [Executive Summary, Page 6]
are as under:
“Implementation of the above proposal would facilitate grid security
further, considering the ER-NR interconnection expected by June 2006
It would provide strong incentive to harness all latent generation and/or
trade the same through Short Term Open Access (STOA).
It would give a strong signal for capacity addition as any developer could
have only a Power Purchase Agreement (PPA) for 70-80% of his output
and trade the balance.
It would encourage the state utilities to forecast their load accurately and
make plans to meet the load accordingly.
It would send strong price signal for energy conservation and demand side
management.
It would bring some orderliness in load shedding and ensure that areas
covered by under-frequency relays (UFRs) are exempt from load shedding
thereby enhancing grid security.
It would facilitate introduction of Free Governor Mode of Operation of
generating units.”
4. CERC conducted an oral hearing on the petition number 4/2006 on 27th April
2006 wherein the Commission ordered as follows. [Section 13]
“...We have also taken note of the views of the petitioner and the respondents
on the question of revision of UI rates as also on payment security
mechanism and reserve our orders on these aspects. For the time being the
existing UI rates shall continue to be applied. The grid situation shall be
observed for three weeks to gauge the impact of various disciplinary
measures ordered today. If the situation does not improve to whole
satisfaction of the concerned authorities, the proposal to revise the UI rates in
order to induce grid discipline shall be taken up. Even during the intervening
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three weeks, if State Utilities indulge in overdrawals against the direction of
RLDCs the latter will be free to file the cases of indiscipline before this
Commission.”
5. Based on the above order in petition no. 4/2006, NRLDC filed petition no.
25/2006 in the matter of ‘endangering grid security by undisciplined over drawal
from the grid’. This was heard on 09th May 2006 and action under Section 142 of
Electricity Act (EA) 2003 was taken against the respondent (and subsequently
also upheld by the Appellate Tribunal for Electricity in Appeal number 88 of
2006). The matter was referred to an Adjudicating Officer who after due enquiry
ordered action under Section 29 of the EA 2003 against the respondent.
6. Frequency profile (% of time frequency remained in the IEGC band of 49.0-50.5
Hz) of all the regional grids in the country since April 2006 is as below:
Month
April 2006
May 2006
June 2006
July 2006
August 2006
September 2006
October 2006
November 2006
December 2006
January 2007
Percentage of time frequency remained
between 49.0-50.5 Hz
South
North
Central
(NorthEastEast-West
grid)
25.9
65.1
76.2
86.3
96.8
95.6
81.6
97.5
98.7
70.5
97.7
99.4
60.8
97.8
99.2
95.9
98.6
90.2
89.5
88.8
99.3
87.2
89.6
71.7
87.9
*Combined North-East-West-Northeast grid
The gradual deterioration in frequency profile in the last two years would be clear
from the graph below.
After some respite in May 2006, the frequency profile in Northern Region again
deteriorated till 25th August 2006. It improved after the synchronization with
Central Grid at 1220 hrs of 26th August 2006. This was mainly on account of good
monsoon in East, West and South resulting in reduced power demand. The
surplus power could be transferred to Northern region through the AC and DC
interconnection. The frequency regime started deteriorating w.e.f 09th October
2006 with the tapering of hydro generation as well as increase in demand in all
regions.
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7. POWERGRID submitted details of overdrawal of all constituents for the period
09th to 15th October 2006 to CERC as directed in their letter dated 17th October
2006.
8. SRLDC filed petition number 145/2006 in November 2006 in the matter of
‘ensuring secure and reliable operation of Southern Regional Grid by maintaining
the grid frequency above 49.0 Hz. and review of the UI price vector’. This was
heard by CERC on 11th January 2007.
9. The issue of revision of UI price vector has been under discussion throughout the
year 2006 in different fora. Relevant extracts from these meetings is listed at
Section G below.
10. The stakeholders concerns that are mentioned in the CERC order dated 27th April
2006 [Section 11] are stated below:
“Notwithstanding shortage of power, grid security is of paramount concern.”
“Any increase in UI ceiling rate would further tend to escalate the price of
traded electricity. Simultaneously, there is also an urgent need to curb
overdrawals and to remove the impression on the part of the utilities to
consider regional grid as infinite source of power. Therefore, stronger
commercial measures are required to curb overdrawing and to ensure full
scheduling of liquid fuel generation.”
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“Differential UI rates scheme will not result in zero sum of UI account matrix. It
will result in system operator ending up with a surplus amount.”
“There is a general apprehension that even after increase in UI price, it would
be difficult to curb overdrawals completely. Therefore, under such situations
all measures from grid stability point of view like automatic disconnection of
load through frequency sensitive relays in the event of low grid frequency
should be strengthened.”
11. On 19th December 2006 CERC conducted a public hearing on the creation of
Power Exchange (PX) in India. It emerged during the consultations that trading
through PX would have to coexist with short-term open access and the
Unscheduled Interchange mechanism.
12. With the background mentioned above and the experience gained after the
formation of synchronous North-Central Grid, a proposal for review of UI price
vector is enumerated in subsequent sections. This is in compliance to the
direction issued by CERC vide order dated 15th January 2007 in the petition
145/2006.
Section-B:
General principles of revised UI vector as agreed among five RLDCs
1. CERC order dated 15th January 2007 was received by POWERGRID on 19th
January 2007. Thereafter it was communicated by all RLDCs to SLDCs and they
were requested to forward their proposals.
2.
Responses were received from UPPCL, PSEB, BSEB, WBSEB, DVC, JSEB,
APTRANSCO, KPTCL, and TNEB. PSEB sought more time to study the issue
while KPTCL informed that the matter was under the approval of their
management. DVC, WBSEB and JSEB have proposed increase in UI rates from
the viewpoint of grid security although no formal proposal has been submitted
while others have shown reservation in increase of UI rate.
3. The SLDCs other than DVC, WBSEB and CSEB, who have responded, are
generally in an ‘overdrawal’ mode. This response of constituents have been
changing depending on the state’s power supply position viz. if the state is in
surplus it would support enhancement of UI rates and if it is in a severe shortage
situation it would resist any enhancement. However there is a concern as to how
the grid security issue would be addressed by SLDCs notwithstanding their
statutory responsibilities under Section 32 and 33 of the Electricity Act 2003.
4. The five RLDCs and Corporate System Operation, POWERGRID had an
intensive discussion on the subject through the video conferencing sessions on
22nd and 23rd January 2007. The consensus that emerged in these discussions is
as under.
a. The UI price vector should be a simple curve so that it is easy to
comprehend and administer.
b. The UI price vector should be in the nature of a commercial signal that
complements security. The mechanism should bring economy and
efficiency through merit order generation and it should be consistent with
the frequency linked despatch guidelines.
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c. The vector should facilitate voluntary generation dispatch through
commercial signal in accordance with the Indian Electricity Grid Code
(IEGC) clause 6.2.8 [“When the frequency falls below 49.5 Hz, the generation at
all ISGS (except those on peaking duty) shall be maximized, at least up to the level
which can be sustained, without waiting for an advise from RLDC.”]
d. The unrequisitioned liquid fuel generation is being despatched and
scheduled to overdrawing states at frequency below 49.5 Hz. This is being
done by RLDCs in accordance with the direction of the Honourable
Commission in petition no. 4/2006. However, the liquid fuel generation
should get voluntarily dispatched below 49.5 Hz without any need for post
facto revisions.
e. Demand side management through a commercial signal in the price vector
is required between 49.5 to 49.0 Hz in accordance with IEGC clause
5.4.2. [“...the constituents shall endeavour to restrict their net drawal from the grid
to within their respective drawal schedules whenever the system frequency is below
49.5 Hz. When the frequency falls below 49.0 Hz, requisite load shedding (manual)
shall be carried out in the concerned State to curtail the over-drawal.”].
f.
g.
h.
i.
j.
k.
l.
m.
n.
The rate at 49.0 Hz should be such that it brings out the latent generation,
provides incentives for NegaWatts (NW) and thus dissuade overdrawal
from the grid. This is also necessary to ensure grid security. Physical
regulation and petitions for non-compliance have their own limitations and
therefore they are to be sparingly used.
The dynamics of the fuel price variations in the UI price vector could be
incorporated through indexing of the UI rates to reduce distortions
resulting from externalities. However for the time being, impact on UI
mechanism on account of fuel price variations are to be incorporated by
periodic revision through a consultative process.
The present UI rates between 50.5 Hz to 49.8 Hz viz. zero at 50.5 Hz and
210 paise/kWh at 49.8 Hz could continue.
In order to harness all available generation on bar including generation on
liquid fuel below 49.5 Hz, the UI rate around 49.3 Hz has to correspond to
the variable cost of generation on liquid fuel.
In view of acute shortage and in order to harness the latent generation
available in ISGS (through efficiency gains and design margins), the cap
of 101%/105% on generation above the Declared Capability (DC) might
be removed. The compensation for the extra generation over and above
the DC would have to be suitably designed.
The state utilities could be compensated as per the proposed UI rates for
under drawal from grid.
The UI price vector should be uniform in all regions.
A suitable payment security mechanism in the form of credit instrument is
necessary.
Other issues like- ‘different buy-sell rate’, ‘geographical differential rates’,
‘congestion management through differential UI rate’, ‘different peak/offpeak rate’, ‘cap on UI volume’ are very intricate issues and could be
discussed after observing the grid performance with the revised UI rate
and development of organized marketplace [PX] in India.
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Section C:
UI rate proposal
The UI rates proposed are as under:
i)
ii)
iii)
Above 50.5 Hz
At 49.80 Hz
Below 49.02 Hz
: zero (no change vis-a-vis existing)
: 210 paise/kwh (no change)
: Not lower than 930 paise/kwh
(existing level is 570 paise/kwh)
Between 49.02 Hz and 49.8 Hz, the UI rate could vary in any manner (linear or
exponential), with or without any kinks at intermediate points. The only
requirement is that there should be a strong signal for full dispatch of all the
combined cycle power plants operating on naphtha (energy cost of the order of
650 paise/kwh) by 49.3 Hz.
There was a general agreement that in view of the acute energy shortage in the
entire country, efforts must be made to conserve fuel and avoid operation above 50
Hz to the extent possible. NRLDC had expressed similar views in petition no. 4/2006.
However in the absence of any cap on UI volumes, this might result in network
congestion in case Northern region load centre based power plants start backing
down as per the frequency linked despatch guidelines.
Hence we do not propose any change in the UI rate between 49.8 Hz to 50.5 Hz.
The rationale for the ceiling rate below 49.02 Hz is indicated in Section D below.
Section D:
1.
Rationale for the UI ceiling rate below 49.02 Hz suggested at not
lower than 930 paise/kwh in Section C above.
Should there be separate steeper rates below 49.0 Hz ?
In the earlier deliberations in RPC fora and Ministry of Power, a
suggestion for having different UI rates below 49.0 Hz was advocated by
many stakeholders. We feel that this is inconsistent with the IEGC
provisions where the need to maintain frequency in the 49.0 –50.5 Hz
band is emphasized. With the formation of the extended North Central
grid, there is a need to further restrict the operation band to 49.5 to 50.0
Hz so that a frequency change does not lead to large changes in line
flows. The UI price mechanism should give strong signals to maintain the
frequency within this band instead of 49.0-50.5 Hz.
The operation below 49.0 Hz is to be treated as a violation of the IEGC
and addressed as such. In fact the Appellate Tribunal for Electricity in its
order dated 28th September 2006 in Appeal no. 88 of 2006 has
pronounced as under:
‘36. It appears that this submission of the learned senior counsel is
purportedly based on Clause 6.4.7 of IEGC, which, inter-alia, provides that
deviations from the ex-power plant generation schedules shall be
appropriately priced through the UI mechanism. But the learned senior
counsel for the appellant overlooked the mandate of clause 6.4.4, which
prescribes that when the frequency falls below 49 Hz requisite load shedding
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shall have to be carried out to curtail the overdrawal. Up to a frequency of
49.0 Hz, system can be controlled by UI but below that it must be controlled
by the stringent provisions of section 142 of the Act, as the safety and the
security of the grid cannot be jeopardized since it affects the other
beneficiaries.’
Therefore any proposal for stretching UI price vector below 49.0 Hz, if
implemented, would be a serious threat to grid security. This has also been
covered in Section 5.9.8 of ABT Order dated 4th January 2000 of the CERC.
However, the commercial signal below 49.5 Hz itself should be strong
enough to avoid operation below 49.0 Hz.
2. Rationale for UI rate at 49.0 Hz:
This issue has been discussed at several stages and is briefly reproduced below.
i. ECC Report, Feb 1994: Section 4.6.4 of page 4-19 of the Report under
‘Frequency Linked UI tariff option’ states ‘Specifically, UI would be priced in this
scheme as follows:
Pit head incremental cost when frequency is greater than 50.3 Hz.
Load center incremental cost when frequency is between 49.7 Hz and
50.3 Hz.
Diesel generation incremental cost when frequency is below 49.7 Hz.’
Thus the ECC Report considers the diesel generation incremental cost as the
highest cost to be payable for imbalances below 49.7 Hz.
ii. CERC order dated 4th January 2000 in petition no. 1/99: Again Section 5.9.7
of this order indexes the UI rate to diesel generation. The UI ceiling rate worked
out as per this methodology was 420 paise/kwh when diesel prices were Rs.
13.33 per litre.
iii. CERC order dated 16th January 2004 in petition no. 67/2003: Again the UI
rate has been indexed to diesel generation cost. The UI ceiling rates worked
out to 600 paise/kwh when the diesel prices were Rs. 21 per litre.
iv. Petition no. 4/2006 filed by NRLDC in January 2006 and detailed proposal
in March 2006:
NRLDC had also suggested that the UI ceiling rate should
be indexed to diesel prices which worked out to 950 paise/kwh based on diesel
price of Rs. 33.65 per litre.
v. MERC order on CII proposal to harness captive generation during peak
hours to make Pune load shedding free: In order dated 2nd March 2006 in
case no. 29 of 2005 and order dated 16th May 2006 in case no. 1 of 2006
issued by the MERC, the average fuel efficiency of captive sets in Pune
industrial area has been assumed as 3.49 kwh/litre and with the average diesel
rate of Rs. 38 per litre, a rate of Rs. 11.04 per kwh has been approved by
MERC.
vi. Agreements for unrequisitioned liquid fuel generation from NTPC
combined cycle plants signed in the recent past: These agreements have
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been signed for rates ranging from 746 paise/kwh to 874 paise/kwh ex-power
plant. Open Access charges, scheduling charges and transmission losses are
borne by the buying utility. In case of drawal of power through the UI
mechanism, no transmission charges and transmission losses are payable.
Considering the present UI ceiling rate of 570 paise/kwh, these agreements
have not translated into scheduling. If one considers a rate of 750 paise/kwh
ex-power plant and a pan India power transfer through Open Access, leading to
an incremental loss of say 20% over three regions, the rate at the buyer’s
periphery would be 940 paise/kwh. The UI rates need to be more than this
value to ensure that the plant is despatched at that low frequency level.
Since April 2006, NRLDC has been directed to ensure that the liquid fuel within
the region is despatched fully whenever the frequency is low and the extra
generation be booked to the overdrawing constituents. In case the UI ceiling
rate is lower than 930 paise/kwh, this mode of centralised despatch would
continue. Already suggestions have been made for extending this arrangement
to liquid fuel stations outside the region also. This is not in conformity with the
operating philosophy of decentralized despatch adopted in the country and
provides scope for disputes. This is also not in conformity with the spirit of
Section 28(3) a of the Electricity Act 2003.
The diesel generation rate worked out through some of the above references is
tabulated below (based on Jan-07 price levels)
In view of all the above facts, the UI ceiling rate below 49.02 Hz has to be
greater than 930 paise/kwh. Incidentally all the calculations in the table
above do not include the fixed charge component of 160 paise/kwh that had
been considered while working out 420 paise/kwh and 600 paise/kwh.
Further in the latter case, the fuel efficiency of diesel generation has been
considered as 5 kwh/litre by CERC, which would be the case for a
combined cycle plant. Although internal combustion diesel engines of this
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efficiency are available worldwide, their percentage would be very small.
The MERC order no. 29 of 2005 on Pune captive generation gives 3.49
litres/kwh as the industry average for that belt and compares well with the
figures listed in NRLDC petition no. 4/2006.
Section E:
Stakeholder concerns voiced in the past
Several issues like undue gains to ISGS for generation beyond DC and up to
101% of DC , traded prices going up and grid security issue would not get
resolved through enhanced UI prices have been raised in the past.
1.
Generation beyond Declared Capacity (DC) by ISGS:
It is proposed that to harness all the latent generation from coal fired stations in the
form of efficiency gains through lower auxiliary consumption and the inherent design
margins, caps on the generation above Declared Capability is removed. At the same
time to avoid any undue profits to the generator on account of a rise in UI ceiling
charges, the following checks are suggested on UI charges payable to ISGS for
generation above Declared Capability (DC).
a.
For coal fired thermal stations:
i. In case DC
Consumption)
>=
Capacity
on
bar/(1-Normative
Aux.
No 101/105% cap but all UI payments would be restricted to a rate
per kwh specified by the Commission or UI rate whichever is lower.
ii. In case DC<Capacity on bar/(1-NAC)
b.
101/105% cap on UI and all UI payments would be restricted to a
rate per kwh specified by the Commission or UI rate whichever is
lower.
For gas fired and hydro stations:
101/105% cap on UI and all UI payments would be restricted to a rate
per kwh specified by the Commission or UI rate whichever is lower.
1. Prices of traded power vis-a-vis UI rates:
UI price is in the form of a vector and it varies from 0 to the ceiling rate depending
on the frequency. Therefore comparison of the ceiling rate with traded price is
inappropriate. Further only 5-6% of the total electrical energy exchanged in the
country is through short term trading and UI and the balance 94% is through long
term contracts. Short term trading and UI is used by state utilities to balance their
portfolios on the day of operation. As on date, the additional power that is
available in the grid is only on account of liquid fuel and embedded generation,
which has to be harnessed in case load shedding is to be minimized.
Notwithstanding the present UI ceiling rate of 570 paise/kwh, short term traded
prices have already breached this UI ceiling value.
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Any constituent overdrawing in large quantities in a shortage scenario would
naturally object to the UI rates being enhanced while any constituent who has a
balanced portfolio (with a small quantum of short term trades and UI) and
maintaining his drawal within schedule need not be unduly concerned about the
UI rates.
2. Grid security:
The UI price signal should be strong enough to harness all the latent generation
and discourage unlimited overdrawals at low frequency. On account of vividness
bias, this aspect affecting grid security is not recognized and the more visible
traded prices is only seen.
A strong price signal for NegaWatts, which has to be periodically reviewed by the
Commission, would greatly complement grid security. Ultimately this price signal
should get translated to the retail level and the process has already started in
some states with the implementation of intra-State ABT and this needs to be
expedited. The same has to be strengthened at the wholesale level also. Signals
at both these levels would only enhance grid security.
We believe that the issue should be seen as one of enhancement in grid
security and not as one of enhancement in UI prices.
Section-F:
Related Issues that could be taken up at a later stage
1. Congestion management through UI mechanism: The regional grids in India are
by and large congestion free. In fact the entire Unscheduled Mechanism as
implemented in the Indian grid presupposes a constraint less transmission system.
However subsequent to the formation of the North-central grid, the problem of line
overloads in a few pockets has been experienced on certain occasions. The
identifiable reasons for occasional transmission constraints are as below:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
Long years of congestion free operation leading to an inadequate
appreciation of the line loading aspects of system security
Sharp changes in the interchange with the grid due to bulk load regulation
and start-stop of hydro units at the hour boundaries.
Huge gap in the demand and supply and the pressure to meet the demand
General perception of UI as an infinite source
Market distortion caused by the difference in the ceiling UI rate and the
marginal cost of generation from liquid fuel
Absence of line-loading/transmission component in the UI mechanism
Skewed despatch scenario under abnormal conditions.
In India no congestion management tools such as Locational Marginal Pricing (LMP)
exists and the UI mechanism does not have a ‘line-loading component’ as brought
out by the Joint Inadvertent Interchange Task Force (JIITF) Report1. Congestion is
presently being handled through real-time operation in line with section 7.5.10 of the
IEGC and section 6.4.9 of the IEGC. (UI to be curtailed first followed by short term
bilateral followed by long term contracts).
1
The White Paper issued by the Joint Inadvertent Interchange Task Force (JIITF) constituted by the North American
Electric Reliability Council (NERC) on 10th May 2002 has divided the issue of Inadvertent Interchange into three
components viz. the frequency component, line loading component and the energy component. In the Indian context,
the frequency linked UI mechanism has bundled the energy component and the frequency component.
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A cap on UI volumes had been proposed by NRLDC in petition no. 4/2006 to address
the issue of line loading. However caps have their limitations and result in market
distortion. Therefore further studies are required in this area of congestion
management.
Thus UI is as at present (for the time being) not being envisaged as a
congestion management tool and a uniform frequency linked UI price vector is
proposed for all the regions in India.
Section G:
Extracts from meetings at Ministry of Power, RPC and other forum
regarding UI rates.
“Higher penal rate below 49.0 Hz would act as a deterrent for over drawal from the grid.”
Chief Secretary, Government of Punjab
Minutes of the meeting taken by Secretary (Power), Government of India
[7.1 (vi)], 6th May 2006
“Freezing UI rate at 49.0 Hz was proving to be counter productive as the state is forced to
under draw from the Regional grid on account of overdrawal of other states and the gap
equivalent to underdrawal is required to be filled with naphtha based generation which is
costing about Rs. 7-7.50 per kwh. The UI rate below 49.0 Hz should therefore be increased
and there should be a cap on the price of traded power.”
Principal Secretary (Energy), Government of Haryana
Minutes of the meeting taken by Secretary (Power), Government of India
[8.1 (ii)], 6th May 2006
“Enhanced penal rate below frequency of 49.0 Hz as suggested by Haryana would be
necessary.”
Secretary (Energy), Government of Rajasthan
Minutes of the meeting taken by Secretary (Power), Government of India
[9.1(viii)], 6th May 2006
“Enhanced penal rate for frequency below 49.0 Hz will be desirable. But there should be
capping on price of traded power also.”
Principal Secretary, Government of Uttar Pradesh
Minutes of the meeting taken by Secretary (Power), Government of India
[10.1(xvi)], 6th May 2006
“Other constituents of Northern Region also expressed unanimity in regard to need for
higher UI arte below 49.0 Hz. Secretary (Power) agreed to bring the opinion of Northern
Regional constituents to the notice of CERC, who is already seized with the matter.”
Minutes of the meeting taken by Secretary (Power), Government of India
[8.2], 6th May 2006
“Since it was unanimous view to have enhanced penal rate below frequency of 49.0 Hz., the
matter will be referred to CERC for appropriate action.”
Secretary (Power), Government of India
Minutes of the meeting taken by Secretary (Power), Government of India
[12 (viii)], 6th May 2006
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“Surplus power of Captive Power Plants (CPPs) needs to be tapped with mitigation of cost of
power from CPPs with proper dispensation from the concerned Electricity Regulatory
Commission for this purpose keeping the consumers duly informed about the efforts made
by the distribution utility to supply power to avoid load shedding by procuring costlier power
during the periods of high demand...”
Secretary (Power), Government of India
Minutes of the meeting taken by Secretary (Power)
to review the operational discipline in Northern and Western Regions
[3(iv)], 20th October 2006
Secretary (Energy), Rajasthan suggested substantial enhancement in price of UI charges
below 49.0 Hz to deter the states from overdrawing energy from the grid.
Minutes of the meeting taken by Secretary (Power)
to review the operational discipline in Northern and Western Regions
[7.], 20th October 2006
“CE, TNEB said that the present rate is also high and suggested UI rate of zero paise above
50.3 Hz.”
Section 3.5.3, Minutes of 118th TCC meeting of SRPC
17th March 2006
“Director (Tr. & GO), APTRANSCO said that at present the costly Naptha generation was
not being scheduled even at very low frequency, and with the suggested increase in rates at
low frequency the costly generation may be injected into the grid. He suggested a decline in
slope after 50 Hz to discourage ISGS injection at higher frequencies.”
Section 3.5.3, Minutes of 118th TCC meeting of SRPC
17th March 2006
“The constituents fully appreciated the need for curtailment of overdrawals and providing
commercial deterrents by way of penalties for frequencies below 49.0 Hz.”
Section 1.1, Minutes of 140th SRPC meeting
18th March 2006
“WRLDC proposed to increase the U.I. rates by 1.5 times for deviation at or below 49 Hz; to
levy a penalty of Rs.1 lakh per time block whenever the overdrawal during any time block is
more than 200 MW and the average frequency is less than 49 Hz. ”
Section 4, Special meeting of WRPC
13th January 2007
“The utilities were generally of the view that imposition of financial deterrents might not help
in bringing in grid discipline...Regarding increasing the UI rates, it was felt that it may boost
the rates of power available through bilateral trading.”
Section 5, Special meeting of WRPC
13th January 2007
Section H:
Extracts from SLDC responses received against CERC order dated
15th January 2007
“APTRANSCO is of the view that increase in UI prices is not required as it results in (i)
bench mark price for power traders and increase in power purchase cost (ii) any further
increase UI price will not address the power system operational issues fully.”
Chief Engineer/Comml., Transmission Corporation of Andhra Pradesh
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Letter no. CE/COmml/APPCC/pet-srldc/D.No. 383/07
24th January 2007
“Increasing the Ui prices will only result in abnormal increase in the price of surplus power
available and offered for sale through the traders... TNEB is of the view that any increase to
the existing UI rates need not be attempted for the present under the guise of secure grid
operation.”
Executive Director /Operation, Tamil Nadu Electricity Board
Letter no. ED/O/SE/LD&GO EG/A7/CERC/D/95/07
23rd January 2007
”Suitable enhancement of UI may kindly be considered for more security and more reliable
operation of the grid.”
Chief Engineer, SLDC, Damodar Valley Corporation
Letter dated 24th January 2007,
in reply to ERLDC’s message no. GM/OPRN dated 02nd January 2007
“For many a period of the day, grid frequency is remaining below 49.0 Hz. This indicates that
some of the constituents are not controlling overdrawal at low frequency. Grid discipline is
being weakened. Increase in UI rates may compel them to reduce overdrawal and in turn to
maintain frequency with permissible range.”
Chief Engineer, SLDC, West Bengal State Electricity Board
Letter dated 24th January 2007
in reply to ERLDC’s message no. GM/OPRN dated 02nd January 2007
“The Unscheduled interchange has been imposed to maintain grid discipline. The present
trend of frequency is quite below than it was before synchronization with N.R. Considering
safety and stability of transmission network, if ERLDC feels change in U.I. charges, may be
considered.”
SCE, SLDC (for Chief Engineer, SLDC), Jharkhand State Electricity Board
Message no. 118 dated 24th January 2007
“On pragmatic grounds too and in the light of recent experiences, it doesn’t seem advisable
to enhance the UI rates further.”
Chief Engineer (Power System), Uttar Pradesh Power Corporation
Letter no. 24/CE(PS)/NRLDC/EE-2
24th January 2007
“The revision of the Unscheduled Interchange (UI) is not necessary on All India basis as the
present system of UI is working satisfactorily...Further also Bihar is not having any
generation of its own and have to depend heavily on its share in the generation of the
Central Sector and in the event of the planned shutdown of any of the unit of the Central
Sector generating station, the respondent BSEB have to depend on UI to meet its essential
load in the state”
Chief Engineer, Trans. (O & M), Bihar State Electricity Board
Letter no. Com/CERC-602/2006/70, dated 24th January 2007
25th January 2007
Page 13 of 14
POWERGRID
Section I:
List of references
1. ECC Report: ‘Study of Bulk power and transmission tariffs and transmission
regulations’ February 1994
2. CERC order dated 4th January 2000 on Availability Based Tariff (ABT)
3. CERC order dated 16th January 2004 on ‘Terms and Conditions of Tariff with
effect from 1st April 2004’
4. CERC order dated 15th July 2004 on amendment to ‘Terms and Conditions of
Tariff with effect from 1st April 2004’
5. Electricity Act 2003
6. Indian Electricity Grid Code (IEGC)-December 2005 issue with amendments
7. Petition no. 4/2006 filed by NRLDC
8. CERC order dated 27th April 2006 in petition no. 4/2006
9. CERC order dated 9th May 2006 in petition no. 25/2006
10. Appellate Tribunal for Electricity order dated 28th September 2006 in Appeal no.
88 of 2006
11. CERC order dated 15th January 2006 in petition no. 145/2006
12. North American Electric Reliability Council (NERC) Inadvertent Interchange: A
White Paper prepared by the Joint Inadvertent Interchange Task Force: Draft 5d,
10th May 2002
25th January 2007
Page 14 of 14