Compensation Rules for curtailing ‘Must Run’ Renewable Power notified vide Electricity (Promotion of Generation of Electricity from Must-Run Power Plant) Rules, 2021

On October 22, 2021, the Central Government notified Electricity (Promotion of Generation of Electricity from Must-Run Power Plant) Rules, 2021.

Key points:

  • Mustrun power plant : A mustrun power plant shall not be subjected to curtailment or regulation of generation or supply of electricity on account of merit order dispatch or any other commercial consideration.
    Note: A wind, solar, windsolar hybrid or hydro power plant (in case of excess water leading to spillage) or a power plant from any other sources, as may be notified by the Appropriate Government, which has entered into an agreement to sell the electricity to any person, shall be treated as a mustrun power plant.
  • Compensation: In the event of a curtailment of supply from a mustrun power plant, compensation shall be payable by the procurer to the mustrun power plant at the rates specified in the agreement for purchase or supply of electricity.
    Note: 1. Any deficit in realisation of amount, with respect to the compensation shall be paid by the procurer on monthly basis.
    Note: 2. Any excess realisation of amount during a month from sale of electricity in a power exchange, if any, shall be carried forward and adjusted in the next month or months.


  • Intermediary procurer to procure electricity for distribution licensees: The intermediary procurer, an agency nominated by the Central Government or State Government, may procure electricity through a transparent process of bidding in accordance with the guidelines issued by the Central Government under section 63 of the Act for sale to one or more distribution licensees.
    Note: The intermediary procurer referred to in subrule (1) shall be deemed to be a trader for the purposes of the Act, buying electricity from the mustrun power plant and selling the same to one or more distribution licensees.

  • Appropriate Government: The Appropriate Commission shall adjust the rate of tariff on annual basis based on the actuals. The intermediary procurer, from the sale of electricity under these rules, shall be allowed to retain only the trading margin as specified in the agreements or the regulations or as may be determined by the Appropriate Commission.

Join the discussion

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.