Central Electricity Regulatory Commission fines MP Power Trading Company
07 Aug 2008
Making it absolutely clear that grid indiscipline will not be tolerated, the Central Electricity Regulatory Commission (CERC) has imposed a penalty of Rs1 lakh on the Madhya Pradesh Power Trading Company Limited under Section 142 of the Electricity Act, 2003.
Going even further, CERC has also issued a notice to the managing director of the trading company as to why additional penalty should not be recovered from him in view of the provisions of law that the person-in-charge of and responsible for the conduct of business of the company guilty is also liable to be proceeded against and punished.
The CERC found the trading company guilty of non-compliance of the its directives for liquidating the amount of 'unscheduled interchange' (UI) arrears which had piled up to Rs338 crore.
The CERC came down heavily on the defaulter and said that overdrawl from the grid and not making payment for the same were the symptoms not only of grid indiscipline but also of financial indiscipline, when seen in the light of the fact that the respondent has earned revenue through sale of power over-drawn from the grid and this cannot be permitted.
Stating that payment of UI charges is to bring about effective discipline in the system and the maintenance of grid discipline, the Commission emphasized that timely payment of UI charges is a duty owed by every utility to other grid connected entities as it contributes towards grid discipline.
