NEW DELHI: The promotion of captive power generation among industries holds potential to lessen their power woes to a great extent, as expressed by Rajiv Agrawal, secretary, Indian Captive Power Producers Association (ICPPA) while talking exclusively to SME News.
Although he favoured the recent suggestion forwarded by global ratings firm Standard and Poor's (S&P) that a sustained improvement in discoms' credit quality does not lie in restructuring debt of PSU power distribution companies, rather more and more private sector participation can provide a long-term solution to the country's power sector woes.
As per the recent government proposal, a portion of PSU power distribution companies' debt will be restructured, with about a half of it getting transferred to state governments. This could happen through guarantees on bonds that the discoms will issue.
Captive generating plant means a power plant set up by any person to generate electricity primarily for his own use and includes a power plant set up by any co-operative society or association of persons for generating electricity primarily for use of members of such co-operative society or association.
While backing captive power generation, Agarwal said the practice of adopting captive power generation can reduce the transmission and distribution (T&D) losses, which will in turn satisfy the projected power demand.
Moreover, he also blamed uncertain and unfocused government policies behind the ongoing power crisis in the country and urged the government to bring hasten reforms along with the proper implementation in order to bring back the power sector on track.