The Centre has invoked its emergency powers to ensure power plants which use imported coal run at optimum capacity during the summer months and prevent blackouts.

The Union power ministry has invoked the emergency powers under Section 11 of the Electricity Act so that the power plants maximise their output and sell surplus power in the exchanges.

A committee will be set up to determine the rates at which the plants will have an option to sell electricity to power distributors with whom there is a power purchase agreement.

The order shall remain valid from March 16 to June 15. The notice was sent to 15 thermal plants that use imported coal and can produce 17 gigawatts (GW) of electricity.

The 15 imported coal-based power plants include the plants of Tata Power and Adani Power at Mundra in Gujarat; the Essar plant at Salaya in Gujarat and the JSW plant at Ratnagiri, Maharashtra.

Power stocks surged on Tuesday as investors reacted positively to the government order.

India is expected to face a peak power demand of 229GW in April, and the government order said 193GW would be required from the thermal plants.

The emergency powers were also invoked last year but much later on May 5, when demand soared suddenly and the plants had inadequate coal to meet the demand. Power plants using imported coal were told to generate electricity at their full capacity.

On January 3 this year, the Central Electricity Regulatory Commission (CERC) ordered that plants running on imported coal be compensated for supplying electricity under emergency circumstances. The order was issued in response to a petition filed by Tata Power Company Limited (TPCL).

The power ministry’s latest order mentioned the passthrough aspect for such imported coal-based plants.