Power companies which seek hike in tariffs due to global factors should also reduce rates when international coal prices soften, RV Shahi former Power Secretary and a power sector expert has said. The compensatory tariff is a variable tariff and it should be revised both ways, he added.
Welcoming power sector regulator CERC's order to provide a compensation package to private companies like Adani Power and Tata Power for increase in the cost of international coal, Shahi said that CERC has recognized, if there is change in law in Indonesia, which leads to increase in the price of coal from that country for the companies setting up thermal power projects here, they should be compensated.
The companies, which are increasing their tariffs due to increase in price of coal from Indonesia, should also revise the tariff downwards if international prices fall, he advocated. Earlier this month, CERC in its order said that Adani Power should be granted compensation package for its Mundra project which would provide a cushion against the escalation in cost of imported coal for the plant.
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