Captive to inefficiencies: What our policy should be towards captive units

There are occasions where decisions taken in the past in good faith come back to haunt us due to altered circumstances. This is exactly the case with our captive plants and group captive plants, also called non-utilities at a generic level. A captive power plant is one which is dedicated to one or more industrial unit(s). As far as group captive is concerned, the beneficiaries should hold at least 26% of the equity and together consume 51% of the power generated during the year. Though dedicated, it may also inject electricity to the grid. On the flip side, an industrial unit having a captive station may also draw power from the grid. Thus, it is a two-way relationship. While captive power plants have been in existence since decades, group captive is a relatively new phenomenon which owes its genesis to the Indian Electricity Rules (IER) 2005.