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Examoogle • User • info@examoogle.com • EE-2024-8821
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The captive generation is ________as per Electricity Act-2003
Freely permitted
Not Permitted
Not possible
Required licenses
Freely permitted
Quick Summary: Under the Electricity Act 2003, captive generation is freely permitted to promote industrial efficiency and self-reliance. This allows any person or entity to construct, maintain, or operate a captive generating plant for their own consumption without the need for a license from the Appropriate Commission.
Under the Electricity Act 2003, captive generation is freely permitted to promote industrial efficiency and self-reliance. This allows any person or entity to construct, maintain, or operate a captive generating plant for their own consumption without the need for a license from the Appropriate Commission.
Cu=ToOi≥26% — Minimum equity requirement for captive status
Cc=EtotalEself≥51% — Minimum self-consumption requirement
The principle relies on 'Captive Use,' defined by the ratio of ownership and consumption. To qualify as a captive user, the consumer must hold not less than 26% of the ownership interest and consume not less than 51% of the aggregate electricity generated, determined on an annual basis.
Electricity Act 2003 promotes competition and provides open access to the grid for captive power plants.
No license is required for setting up a captive power plant.
Surplus power can be sold to the grid or other consumers subject to regulatory approval.
Captive power plants contribute significantly to industrial stability in India.
Ensures continuous power supply for industrial operations.
Reduces dependence on state electricity boards (SEBs) during peak load.
Provides cost-effective energy solutions for large-scale consumers.
Avoids cross-subsidy surcharges typically applicable to third-party open access.
High initial capital investment.
Operational and maintenance responsibility lies with the owner.
Fuel supply security management is a potential risk.
Steel and Cement industries
Large manufacturing hubs
IT parks and data centers
Refineries and chemical plants
The Act was brought into force to consolidate laws relating to generation, transmission, distribution, trading, and use of electricity.
Section 9 of the Electricity Act 2003 specifically covers captive generation.
Option B, C, and D are incorrect because the act explicitly deregulated the setting up of captive plants to encourage private participation.
A is correct — Captive generation is freely permitted under Section 9 of the Electricity Act 2003 without the necessity of a license.
Remember that while captive generation is 'freely permitted', it must comply with technical grid standards and safety regulations specified by the Central Electricity Authority (CEA).