EOUs, EPZ/SEZ units can sell captive power

NEW DELHI: In a significant liberalisation of its power policy, the government has allowed export-oriented units and units located at export processing zones and Special Economic Zones to sell electricity generated at their captive power units to units located in the domestic tariff area.
The customs and excise departments have issued enabling notifications and prescribed the guidelines under which such sale could take place.
EOUs as well as EPZ/SEZ units already had the liberty to sell the surplus electricity generated by them to other EOUs or units located in EPZs/SEZs. Power sectors reforms have been taken a step forward by allowing these units to sell directly to consumers in the domestic tariff area.
The government had earlier announced that industries being set up in these zones would be allowed to set up their own captive power plants. In case of sale of electricity to DTA units, the EOU or EPZ/SEZ unit selling power has to pay duty on the diesel used for power generation.
This is mandatory since such units are allowed to procure diesel without paying any duty. While no duty will be leviable when surplus power is sold to another EOU or EPZ/SEZ unit, sale to DTA units will attract payment of duty.