The electronic auction for Power System Development Fund support to stranded gas-based power plants for using imported natural gas to fire up their units began on Tuesday.
Of a total of 31 stranded plants, 14 belonging to the likes of GVK, GMR and Lanco Group will be participating in the auctions. The plants have a combined capacity of 8,100 MW.
The auction began at 11 am on Tuesday. The qualified bidders will first be asked to quote the additional electricity to be generated at the target plant load factor. MSTC, the platform for the e-auction, will then calculate the required imported gas in the next 45 minutes. This process will continue till the required imported gas reaches 120 per cent of the available 8.9 mscmd (million standard cubic meters a day) or the target PLF reaches 35 per cent.
The available gas is for the June-September quarter. Fresh auctions will be held for the October-December quarter.
If even after target PLF reaching 35 per cent, the gas requirement does not reach 120 per cent of the availability, then the auction will be scrapped and a decision to hold it again will be taken at a later date.
However, as soon as the requirement reaches 120 per cent, the bidders would then be required to bid for the least amount of PSDF support required. Bids should be less than the cap and higher than zero.
The Government expects an outgo of ₹792 crore as PSDF support for the current quarter. For the full year, the support has been earmarked at ₹3,500 crore.
Auctions for the plants receiving some domestic gas will start on May 13.