Electricity Gets a Price Makeover: FGD Mandate Eased, Consumers Set to Reap Rewards

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In a path-breaking decision that will help crores of consumers, the Indian government has eased the historic requirement of installing flue-gas desulphurisation (FGD) systems in thermal power plants. The move is likely to reduce the cost of electricity by 25-30 paise per unit, a relief for consumers as well as industries.

Key Points

FGD Mandate Eased:

The government has only required the installation of FGD systems, which absorb sulphur dioxide from power plant emissions, in coal-fired power plants within 10 km of cities with a population of more than one million. Firms in areas of critical pollution or non-attainment will be addressed on an individual basis, and effectively 79% of the thermal power capacity of India is exempt from this costly mandate.

Power Price to Fall:

The move is pegged to cut the price of electricity by 25-30 paise per kilowatt-hour, benefiting consumers and also state power distribution companies (discoms) in managing tariffs as well as easing subsidy burdens.

Science-Based Policy:

The decision follows a series of rigorous studies done by IIT Delhi, CSIR-NEERI, and NIAS, which found that ambient sulphur dioxide levels in the majority of Indian cities are already much below national levels. Low sulphur content in Indian coal and effective dispersion because of tall stack heights make FGD installation across the board uneconomical.

Ecological and Economic Equilibrium:

National retrofitting of FGDs would have added around 69 million tonnes of CO₂ emissions during 2025-2030, in the form of additional limestone mining and energy use. International retrofitting of FGDs was estimated to incur over ₹2.5 lakh crore and could potentially bring in risky hazards to the grid stability during peak hours.

Targeted Regulation:
Managers emphasized that this is a "recalibration" with a scientific basis, rather than a retreat from environmental goals. The government remains committed to protecting air quality where it matters most, as well as keeping energy affordable for all.

Source: Economic Times, NDTV Profit, NewsBytes