A Conundrum

28 Nov 2025 CW Team

To enable access to reliable and quality power, the Electricity Act, 2003, provides for provisions for setting up captive generating plants (CGPs), i.e. power plants set up primarily for a person’s own use. Further, the Electricity Act exempts persons operating CGPs from the payment of cross-subsidy surcharge and additional surcharge, unlike consumers procuring power through third-party open-access arrangements, thereby encouraging captive consumption.

The Electricity Rules, 2005, set out the requirements for a power plant to qualify as a CGP. Herein, at least 26 per cent of ownership must be held by the captive user(s) and at least 51 per cent of the electricity generated annually should be consumed for captive purposes.

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Products

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