The third reverse e - auction for stranded gas - based power plants to get government subsidy for buying costlier imported natural gas will get underway for two days here beginning on Tuesday.
Auctions for the first and second phases were held in May and September respectively last year.
"State - run MSTC Ltd will conduct the third reverse e - auction on March 15 and 16 to provide a total subsidy of Rs. 1, 600 crore for purchasing RLNG (Re - liquefied natural das) imported by GAIL, " said a senior petroleum ministry official here.
"Earlier MSTC Ltd. had planned to conduct the auction on March 15. But later the plan was changed and it was spread over two days. The auction will start at 2 p. m. and likely to be over in two or three hours on both days, " he added.
While auctions for the stranded gas - based power projects (SGP) will be held on Tuesday, the domestic gas - based power projects (DGP) will bid for the gas subsidy on Wednesday.
A total of 10 million standard cubic meters per day (mscmd) of RLNG will be imported to run SGPs and DGPs between April 1, 2016 to September 30, 2016.
According to the bid document, while 8. 9 mscmd of gas will be imported for SGPs, 1. 1 mscmd will be allocated to DGPs.
The government is offering Rs. 1, 400 crore subsidy for SGPs and Rs. 200 crore to the DGPs for buying imported gas to run their plants.
The companies that will participate in the auction include NTPC, Essar, GMR, Lanco, GVK, Tata Power, Torrent Power, GSEC, RGPPL (Dabhol) and CLP India.
The government had, in March last year, allowed gas imports by way of e - auctions for 31
gas - based power units, with a capacity of 14, 000 MW, lying idle for lack of feed stock.
The 31 power stations with a combined capacity of 14, 305 MW became eligible to apply for Power System Development Fund (PSDF) to generate 30 percent of their installed capacity using imported LNG.
In the first phase of auctions in May last year, 10 stranded gas - based power plants bid through reverse e - auction for generating over 5 billion units of electricity to be supplied at below Rs. 5 per unit during peak summer of the year.
In the second phase of e - auctions in September 2015, 13 stranded gas - based power plants with an installed capacity of 8, 262. 08 MW emerged as successful bidders.
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