What is the definition of a captive power plant?

*Definition: Captive Power Plants means:

1…the power plant set up / proposed to be set up by an industry / institution / a person for its / his own
use… (Government of Andhra Pradesh, 1998)

2…generating unit(s) with aggregate capacity not exceeding 166 MW, which produces power for captive
consumption of its owners… (Government of Rajasthan, 1999)

3…the power plant set up/proposed to be set up by a person or a group of persons for his or their own
use… (Government of Madhya Pradesh, 2000)

4…a power plant set up by any person to generate electricity primarily for his own use and includes a
power plant set up by any co-operative society or association of persons for generating electricity
primarily for use of members of such cooperative society or association… (Electricity Act, 2003).

*“Captive Generating plant means a power plant set up by any person to generate electricity primarily for
his own use and includes a power plant set up by any co-operative society or association of persons for
generating electricity primarily for use of members of such co-operative society or association" [Part I,
Definitions]. Note that the word ‘primarily’ is not defined anywhere. Also note that by this definition, a
group of industries can set up a big generating station near a mine for their group’s use and sell excess
power.

It is expected that there would be increase in private generation companies and captive plants. Some
private companies, like Tata Power and Reliance Energy have already announced plans of setting up
large power plants to cater to large industrial consumers. Quantum of such plants, also called “Merchant
plants”, is likely to grow in the coming decade. It is another related matter that the increased availability of
gas, proposed gas pipelines and possibility of LNG and coal import on both coasts has widened the
choice of fuel and technology for generation. The likely economics of generation favours imported coal for
coastal regions, followed by mine-mouth coal and gas. In case of industrial co-generation the gas is
invariably the best option.