Central Electricity Regulatory Commission (CERC or the Commission) directed the National Load Despatch Centre (NLDC) to prepare a procedure on the mechanism to work out compensation for degradation of station heat rate (SHR), auxiliary energy consumption (AEC) , and secondary fuel oil consumption (SFOC) due to part load operation and multiple start/stop of units. The NLDC notified the requisite draft procedure and invited public comments. Towards ensuring clarity of process, accountability in operations, and safeguarding consumer interests, Prayas (Energy Group) has the following inputs:

• Ensure targeted applicability of the compensation mechanism in order to allow for balancing generator concerns with consumer interests
• Consider benefit sharing in the ratio of 1:1, in line with CERC Regulations
• Towards avoiding regulatory ambiguity and litigious delays, the procedure should clearly specify which formulas and regulatory clauses are applicable for computation of parameters in the proposed mechanism
• Towards ensuring uniform treatment and system level benefits, the applicability of the proposed mechanism to Section 63 TPPs must also be clarified