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To recover losses, MahaGenco to sell electricity in open market

For years, MahaGenco has been generating electricity and supplying only to MSEDCL

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With losses mounting to nearly Rs 40,000 crore, of which close to Rs 24,000 crore needs to be recovered from farmers, the Maharashtra State Electricity Distribution Company Limited (MSEDCL) is not being able to buy electricity. Due to this, Maharashtra State Electricity Generation Company Limited (MSEGCL) or MAHAGENCO has been permitted to sell electricity in the open market.

For years, MahaGenco has been generating electricity and supplying only to MSEDCL. However, it has now got trading license from relevant authorities to sell electricity outside. "It's been just a week or so that we have received the trading license. We intend to sell around 10-15 per cent of electricity generated in the open market," said Bipin Shrimali, Chairman and Managing Director, MSEGCL.

MahaGenco has an installed capacity of 13,602 MW. Sources said that of these, close to 40 per cent is not bought by MSEDCL, as the rates are expensive. MahaGenco is looking at exploiting this unused electricity and sell it in the open market.

At present, MSEDCL buys at Rs 3.90 per unit. In the open market, depending on the demand, electricity is sold anywhere between Rs 3.50-7 per unit.

"The price of power in the open market is determined by competition and demand. The chances that electricity will be sold for Rs 6-7 is very less. There are chances that it might be sold at rates lesser than that of MSEDCL," said a power expert.

Another power expert said that over the last few years, a school thought has observed that companies prefer buying power from open market where prices of electricity drop considerably.

MONEY GAME

Rs 40,000 crore: Losses of MSEDCL

Rs 24,000 crore: Amount owed by farmers

Rs 10,000 crore: MSEDCL owes to MahaGenco

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