While fixing a target of one-lakh MW of power generation for the XII Plan, the Union Cabinet on Thursday approved a new policy for allocation of power to be generated by upcoming State-run thermal power plants, earmarking 50 per cent share for the home States.

The proposal approved outlines allocation of 50 per cent power to the home States where the projects are located, 35 per cent to other constituents of the region and 15 per cent power as unallocated power at the disposal of the Centre. The proposal pertains to 14 power projects — Gadarwara, Lara, Talcher Expansion, Kudgi, Darlipalli, Gajmara, Barethi Gidderbaha, Katwa, Dhuvran, Khargone, Pudimadka, Bilhaur and Kathua of NTPC coming up during XII and XIII Plans and all thermal plants of central public sector undertakings, according to an official statement.

At present, power is shared as per Gadgil formula, which provides for 10 per cent power as preferential allocation to home States, reserves 75 per cent for constituent States, including home States and retains the balance at Centre's disposal.

Under the rule, central power generating stations at present can provide a maximum of 33.3 per cent of the electricity to the home State. “Enhancement of allocation to 50 per cent to home States is the only new element in the present proposal,” the statement said.

NTPC's Barethi project in Bundelkhand of Madhya Pradesh, is expected to spur development of infrastructure in the region, it added. While 50 per cent of power from the project is proposed to be allocated to the State, the home State, and 15 per cent of power remains as unallocated power, 35 per cent is proposed to be allocated as a special dispensation to Uttar Pradesh for development of the Bundelkhand region.

The Government also approved setting a power generation capacity target of one-lakh MW for the XII Plan. In the current XI Plan, the government had targeted generation of 78,000 MW, which was slashed to about 62,000 MW.

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