In a significant move poised to reshape India’s energy economics, the government has revised its stance on flue-gas desulphurisation (FGD) mandates for thermal power plants. This recalibration, announced via a gazette notification, is expected to slash electricity costs by 25-30 paise per unit a direct benefit likely to ripple down to the average consumer.
FGD systems, once mandated universally in 2015 to curb sulphur emissions from coal-based power plants, will now be compulsory only for units within 10 km of cities housing over one million people. Plants in critically polluted zones or non-attainment cities will be evaluated case-by-case, while nearly 79% of India’s thermal capacity stands exempt.
The shift follows detailed evaluations by top institutes including IIT Delhi, CSIR-NEERI, and the National Institute of Advanced Studies. Their findings converged on a crucial point India’s ambient sulphur dioxide (SO₂) levels remain largely within safe limits. Readings from multiple cities showed levels hovering between 3 and 20 micrograms per cubic metre, far below the national ceiling of 80.
Further, the studies raised concerns about the unintended consequences of blanket FGD retrofitting. Increased CO₂ emissions from expanded limestone mining, transportation, and added power requirements would offset much of the environmental gain. According to NIAS, installing FGDs nationwide would result in 69 million tonnes of extra carbon emissions by 2030 a heavy climate toll for minimal sulphur reduction, especially when India’s coal contains less than 0.5% sulphur naturally.
Now, with a more focused, science-driven regulation, the sector breathes easier. Industry leaders have praised the move as both rational and consumer-oriented. “This decision reflects regulatory maturity. It addresses pollution precisely where it matters most,” said a senior executive from a leading state utility.
Consumers too are likely to see the benefits soon. With reduced pressure on power producers, generation costs will fall, enabling discoms to manage tariffs more efficiently. This is particularly significant for India’s subsidy-laden power ecosystem where even a small reduction in cost per unit can translate to big savings for governments and end users.
Officials clarified that the policy shift is not a retreat from environmental goals, but rather a recalibration based on real-world evidence. “This is not a rollback. It’s targeted, efficient, and climate-conscious,” one senior bureaucrat noted. The government will also be submitting an affidavit to the Supreme Court in the ongoing MC Mehta vs Union of India case, highlighting this science-backed evolution of policy.
ICP Keshari, Director General of the Power Producers Association, welcomed the move, calling it “consumer-centric” and necessary. He noted that Indian coal’s low sulphur profile means SOx emissions aren’t a major issue; instead, particulate matter remains the primary concern. He appreciated the government’s willingness to differentiate between areas that need FGDs and those that don’t.
In essence, this policy revamp realigns India’s power sector with ground realities, avoids unnecessary financial strain, and reinforces a smarter, data-backed approach to environmental regulation. At a time when affordability and sustainability are equally critical, India may have struck the right balance.