Goa is gearing up to sell excess power on-line, with the new Power Act making it a 'free-trade' commodity to generate, transmit and sell by July next year.

The tiny tourist state has been reaping huge profits from selling 'distress power'.

"We will work out a defined mechanism with proper guidelines to sell power on-line," said Chief Minister Manohar Parrikar. He is setting up an experts' committee to formulate the power trading policy.

Goa is drawing around 358-MW of power, allocated by the National Thermal Power Corporation, from the western and southern grids. However, the state consumes at the most 296 MW at peak hours.

Parrikar claims that Goa is the only state selling excess power with such a mechanism. The experiment, launched some three weeks ago, has already resulted in over Rs 1.25 crore (Rs 12.5 million) additional monthly revenue.

After signing the pact two years ago, the Power Trading Corporation has provided around Rs 210 crore (Rs 2.1 billion) of revenue till date, selling excess power from the western grid. The state has now also signed another pact with the Global Energy Ltd, for the southern grid.

In addition to this regular income coming from the standard amount of excess power, Parrikar says the distress power that gets generated at particular hours could be sold on the spot, by working out a mechanism of on-line monitoring and sale.

"It will generate not less than Rs 110 crore (Rs 1.1 billion) annually," claims the chief minister.

Because of huge amount of power thefts by the power-guzzling units, the local bench of Bombay high court had banned release of power three years ago, bringing industrial development to a grinding halt.

However, the power department was once again in the black after the state initiated stringent action against power thieves, resulting in the generation of excess power.

The new methodology of on-line sale of power to other states would be an additional boost to the Goan economy, Parrikar said.