NEW DELHI, Sep 27 (TIWN): The Central government has invoked Section 11 of the Electricity Act, 2003, directing 112 captive coal-based power plants with an installed capacity of 50 MW or more to operate at their maximum available capacity from October 1 to December 31, 2026.

These captive plants are mainly operated by large industries such as steel, aluminium, cement, petroleum and chemical companies to meet their own electricity needs. The government has asked them to maximise generation so that additional power is available to the wider electricity market.

While the government has previously used Section 11 emergency powers for imported coal-based (ICB) power plants and gas-based stations during peak summer shortages, applying it legally to captive industrial plants for maximum grid support is a first. 

Why has the government taken this step?

India is seeing unusually strong electricity demand. According to reports, power consumption has risen by more than 14% in September, with higher cooling and irrigation requirements amid a deficient monsoon. Peak demand has also moved close to 270 GW, while the 2026 peak-demand projection was around 271 GW.

Under the new direction, the plants must first meet their captive electricity requirements. Any surplus electricity must then be offered through power exchanges, allowing other buyers, including states, to purchase the additional power.

The plants have also been asked to maintain adequate coal stocks and submit weekly reports to the Central Electricity Authority (CEA) covering generation, captive consumption, power sales, available capacity and coal stocks.

In simple terms —---- The Centre wants large industries with their own coal power plants to generate as much electricity as possible for the next three months, while making surplus power available to the market to help meet India's rising demand.

What will they do with extra power?

1. They can use 51% for their own factory.
2. Rest 49% they MUST sell on Power Exchange (IEX) so that States can buy it.