Financial Daily from THE HINDU group of publications
Saturday, Nov 23, 2002
NTPC plans arm for small hydel projects
HYDERABAD, Nov. 22
THE National Thermal Power Corporation (NTPC) will be shortly establishing a mini hydro power company to set up small hydel projects in the country.
The corporation has recently formed two subsidiary companies to take up power distribution and power trading activities, according to Mr R.C. Shrivastav, NTPC Executive Director (Southern Region) and Chief Executive Officer of the newly formed NTPC Electric Supply Company Ltd (NESCL).
Mr Shrivastav said that NESCL was in touch with various State Electricity Boards (SEBs) and State Governments with regard to taking up power distribution. The discussions were in an advanced stage in some of the northern States. NTPC was training its employees in the areas of power distribution and was developing its own distribution systems.
He told newspersons here on Friday that the corporation proposed to trade the unallocated power generated at its units. NTPC also found that there was a lot of potential for establishing mini hydel projects across the country and hence it would be forming a new subsidiary company to take up this activity.
NTPC proposed to form a shell company with initial authorised capital of Rs 5 crore with regard to the joint venture between the corporation and the Tamil Nadu Electricity Board (TNEB) for establishing a 1000 MW coal-based power project at Ennore. Though TNEB has equal participation in the equity, the project management would be in the hands of NTPC.
Stating that the cost of power generation at the 350 MW Kayamkulam Combined Cycle Power Project in Kerala stood at Rs 3.8 per unit at present as against Rs 1.28 at the Ramagundam and little less than Rs 2 per unit at the Simhadri power plant, Mr Shrivastav said that NTPC was currently trying for a long time agreement with a foreign supplier for supply of 5 million tonnes of natural gas for the plant to bring down the cost of generation.
There was also a proposal to set up a LNG terminal near Kayamkulam.
Meanwhile, he said, the Kerala Government, responding to NTPC's request, had agreed to waive the surcharge imposed on the electricity generated at Kayamkulam. This would bring down the unit cost from Rs 3.8 to Rs 3.5. Once the natural gas supply was firmed up, NTPC would consider expansion of the power plant.
Mr Shrivastav said that so far 17 States had signed the tri-partite agreements (TPA) under the scheme for one time settlement of SEB dues. This had led to securitisation of all outstanding dues to NTPC by SEBs of the 17 States. Following the signing of TPA, the four southern States had settled dues to the tune of Rs 1,795 crore.
The imposition of Availability Based Tariff and Tariff principles and norms by the Central Electricity Regulatory Commission (CERC) in December 2000, had led to a substantial reduction in internal resources of NTPC and the total impact on account of this on the corporation would be about Rs 21,500 crore up to the year 2012. This would significantly affect NTPC's capacity addition plans in the 10th and the 11th Five-Year Plans.
By 2012, NTPC proposed to have a capacity addition of 20,000 MW. Of this, the Central Electricity Authority had so far cleared 9,540 MW. Four projects, including Ramagundam Stage III, with a total capacity of 4,300 MW were currently under construction. The Ramagundam Stage III project was scheduled to commence generation by 2004.
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