Shares of power generation companies witnessed significant gains, ranging from 1% to 4%, on September 8 following reports that the Ministry of Power intends to issue a tender to purchase 4,000 MW of gas-based electricity for approximately 20 days between September and November. This move aims to address the growing demand for power and alleviate the pressure on coal-based power plants, as reported by the Economic Times.
As of 12:21 pm, several power companies, including JSW Energy, NTPC, Torrent Power, Tata Power, and SJVN, were trading higher on the BSE.
The Ministry of Power has entrusted NTPC Vidyut Vyapar Nigam with the responsibility of procuring electricity from power generators and selling it in the high-price day-ahead and term markets, according to the report.
This decision follows a similar move by the ministry in April, which was aimed at preparing for increased summer demand and reducing stress on domestic coal and its transportation. Gas-based power generation is typically more expensive and is employed only during periods of high demand.
This development comes at a time when electricity demand has been on the rise since mid-August, reaching all-time highs, while coal supplies at power plants have been depleting rapidly.
