NEW DELHI: The Centre is looking to move amendments to the Atomic Energy Act, 1962 to enable the licensing of three joint ventures proposed by state-owned Nuclear Power Corporation of India Ltd — with NTPC Ltd, Indian Oil Corporation and National Aluminium Company Ltd (Nalco) — to set up new atomic power projects in the country.
Amid concerns over India’s nuclear liability provisions holding up the deployment of imported Light Water Reactor-based projects in collaboration with global vendors, the proposal by NPCIL to strike joint ventures with cash-rich PSUs is being seen as an alternative strategy to tide over the paucity of funds and ramp up execution capability for new projects using the indigenous pressurised heavy water reactor technology.
“Amendments to the Atomic Energy Act, 1962 to enable the licensing of NPCIL’s three joint ventures — with NTPC, Indian Oil Corporation and Nalco — to set up nuclear power projects is under active consideration,” a Department of Atomic Energy (DAE) official said.
The leveraging of NTPC, IOC and Nalco’s project execution capabilities is part of the DAE’s medium-term plan. Under the short-term capacity expansion programme, the NPCIL is already working on ramping up the existing capacity of 5,780 MWe by three folds by the year 2023-24.
Currently, nuclear power reactors set up in the country are being funded by a mix of debt and equity and are executed by NPCIL.
The equity requirements are met from internal resources of the NPCIL, a PSU under the DAE, and domestic budgetary support.
While NPCIL itself has Rs 12,000 crore of investible surplus, the three other PSUs, including NTPC, Nalco and IOC, have broadly agreed to bring in Rs 10,000 crore each.
NPCIL has entered into three separate joint ventures with the three companies. However, these companies require an amendment to the Atomic Energy Act to start functioning and the joint ventures are waiting for the amendment.
The plan entail IOC, NTPC and Nalco each picking up 49 per cent equity in atomic projects proposed to be set up in partnership with NPCIL, which will hold majority equity in the three proposed ventures.
NPCIL now operates 21 reactors with a generation capacity of 5,780 MWe. “Of the 20,000 MWe target for 2020, NPCIL — which has a surplus of Rs 12,000 crore, including cash reserves — can manage only about 10,000 MWe of new capacity through its own financial resources. Hence, funding from other sources is needed to supplement NPCIL’s efforts and the best candidates are PSUs, especially those in the core sector with strong financials and cash flows, an official said.
The Atomic Energy Act, 1962 prescribes that a company in which not less than 51 per cent of the paid-up share capital is held by the Central government can operate nuclear stations. However, the licensing of joint ventures is a grey area.
(Source: The Indian Express, August 4, 2014)
UTTARAKHAND GOVT SAYS NO TO JAYPEE’S OFFER
DEHRADUN: The Uttarakhand government has formally ruled out the possibility of buying the 440-Mw Vishnuprayag hydel project on Alaknanda river, saying it will be not be able to generate the Rs 2,000 crore-Rs 3,000 crore needed for the project.
S S Sandhu, principal secretary to Uttarakhand Chief Minister Harish Rawat, said: “Where is the money? We can’t generate Rs 2,000 crore- Rs 3,000 crore which is needed for buying such big projects.” Similar views were also expressed by power secretary Umakant Panwar. Sandhu also said the government was also not interested in buying private projects. “This is an era of privatisation and not nationalisation,” quipped Sandhu.
Amid reports that the Jaypee group wants to sell its entire hydropower business, a section of top government officials had mooted the idea of buying the Vishnuprayag hydel project in Chamoli district in view of the acute power shortage in the state.
With most of the hydel projects facing legal hurdles owing to environmental concerns, the business proposition of buying Jaypee’s assets in Chamoli district looked attractive at the moment, the officials had opined.
The Bharatiya Janata Party was also not averse to the idea of buying the project. “Since the state is facing power crisis, the government can buy the power project of Jaypee group,” said leader of opposition Ajay Bhatt.
The state, facing acute power shortage, is currently relying on power purchase from outside at steep rates, which in turn puts tremendous financial burden on the state-run Uttarakhand Power Corporation Limited (UPCL), the sole power distribution company in the state. UPCL is running into heavy losses, a big worry for the state government, as it spends more than Rs 1,000-1,500 crore every year on buying power from outside the state.
Another official of the energy department said the government should also try to take a legal opinion whether it had the first right to purchase such assets which are located in the state only.
The government on the other hand is yet to take a view on GVK’s power purchase agreement with Uttar Pradesh on the 330 Mw Alaknanda hydel project which was not seen in the interest of the state.
After failing to make a headway in the hydropower sector despite its tremendous potential, the government is exploring various new options to increase power in the state.
The government has moved to the Supreme Court for the transfer of 25 per cent shares of the joint venture mini ratna company THDC (India) which are held by Uttar Pradesh.
(Source: Business Standard, August 4, 2014)
OPGC CLOCKS HIGHEST PLF AMONG ALL ODISHA STATE RUN GENERATORS
BHUBANESWAR: The 420 Mw Ib thermal power station of Odisha Power Generation Corporation (OPGC) has achieved the highest quarterly PLF (plant load factor) of 91.02 per cent among all state-run thermal power producers in the April-June period of 2014-15.
According to a report by the Central Electricity Authority (CEA), OPGC has also ranked 10th amongst all thermal power producers, both private and state owned, in the country in the above segment.
The high PLF indicates OPGC’s consistent efforts to maintain efficient power production at its Ib thermal power station that has aided Odisha during this peak power requirement season, said a company release.
It may be noted that OPGC has drawn up an expansion plan to add two supercritical units, each of 660 Mw capacity at its Ib valley power station near Jharsuguda.
The expansion plan is being taken up at a cost of Rs 11,547 crore which also includes cost of other components like coal block development and dedicated rail corridor.The construction work for the expansion has already started. OPGC has tied up for loans of Rs 8660 crore from Power Finance Corporation (PFC) and Rural Electrification (REC). The balance funding will come from the Odisha government and US-based AES Ltd, which hold 51 per cent and 49 per cent stake respectively in OPGC, in proportion to their shareholding.
Power equipment major Bharat Heavy Electricals Ltd (BHEL) has bagged Rs 4051 crore contract from the state-owned generator for supply and erection of the main plant envisaging 1320 Mw additional capacity.
The contract is for supply of boiler, turbine and generator (BTG) at an all-inclusive firm price of Rs 3748.94 crore and erection of the main plant at Rs 302.06 crore.
The Balance of Plant (BoP) contract valued at Rs 1573 crore was bagged by BGR Energy Systems. The contract includes supply, erection and commissioning of the BoP for OPGC’s two additional units.
(Source: Business Standard, August 4, 2014)
COAL SHORTAGE HITTING POWER GENERATION IN MAHARASHTRA
GOA: State-owned Maharashtra State Power Generating Company ( Mahagenco) has temporarily shut down five of its 210-mw coal-fired power generation units due to fuel shortage.
“Five 210-mw units of our plants like Turadi and Parli are closed due to coal shortage,” Mahagenco managing director Asheesh Sharma told Fe on Friday, on the sidelines of the 15th Regulators and Policymakers Retreat being held by Independent Power Producers Association of India (IPPAI). The power generation capacity of the five units — 1,050 mw — make up for about 12% of the total power generation capacity of Mahagenco, which is the country’s second largest power generator after NTPC.
Sharma’s statement comes at a time when uncertainty continues to hover over coal availability for an under-construction 3,000-mw power plant, which is expected to be commissioned by the end of this year.
Maharashtra gets bulk of its coal supplies for power generation from Odisha. Mahagenco’s other plants coal stocks are also running low.
(Source: The Financial Express, August 4, 2014)
GEDCOL TO SET UP 20 MW SOLAR PLANT
BHUBANESWAR: Green Energy Development Corporation Limited (Gedcol), the nodal body appointed by the state government to generate renewable energy, has identified about 120 acre land at Manmunda in Boudh district for establishment of 20 Mw solar power plant.
The land has been allotted to Gedcol from the industrial park area earmarked by Odisha Industrial Infrastructure Development Corporation (Idco). The green energy firm, a Odisha Hydro Power Corporation (OHPC) subsidiary, has already floated a engineering, procurement and construction (EPC) tender for the project.
“The EPC tender is for development of the power plant and maintenance for a period of 10 years,” said S K Sahu, commercial director of Gedcol.Apart from the Boudh project, the agency is in the lookout for additional land in Koraput, Kantamal and Bolangir area for installing about 200 Mw solar energy capacity.
(Source: Business Standard, August 4, 2014)
SOLAR FIRMS CHEER IMPORTS FROM MARKET ECONOMIES
NEW DELHI: Solar power project developers’ threat to import solar cells from countries such Japan, Korea, Singapore and others is music to the ears of Indian solar cell manufacturers.
The manufacturers are of the view that it’s better to compete with these countries than “non-market” economies like China. “We have been saying the same thing over the past two years that anti-dumping duty would not have any adverse effect over the solar programme of the country,” said a senior executive of a Delhi-based leading solar cell manufacturer.
He said with the developers choosing countries such as the European Union, Korea, Japan and Canada, it would be a competitive market. “We at least won’t have to compete with non-market economies such as China,” said the executive.
Power project developers had earlier said if a dumping duty is imposed on cheaper imports, the solar power cost would go up and the government’s aim to bring down solar power price would fail. Last month, India slapped dumping duty on solar gear imported in the country from the US, China, Malaysia and Taiwan, in order to safeguard the domestic manufacturing of the same.
The Directorate-General of Anti-Dumping (DGAD), in its final findings, recommended anti-dumping duties of up to $0.48 per watt on solar cells coming from the US and 0.81 per watt on Chinese. The ministry of new and renewable energy and project developers are apprehensive that this would double up the cost of solar power generation. The developers, however, wrote to the government that they would still depend on imports, though from another set of countries. The domestic manufacturers are of the view that the cost of solar power would remain at Rs 7.5 per unit by 2020 if indigenous solar cells are used. The current cost of solar power in the country is the Rs 6.5-8 per unit.
The industry is also hopeful of scaling their current capacity by 300 Mw from current 1,260 Mw, by the year-end. “Dumping duty leads to 20 per cent increase in the cost of solar cells, this in turn translates into a 10 per cent increase in the cost of power project. This also over the period of the project will fall to eight per cent. It’s better than the country wasting Rs 11,000 crore of foreign exchange in importing solar cells,” said Ajay Goel, chief executive officer, Tata Power Solar.
According to the data shared by the solar power producers, the cost of the Chinese solar cells is around 58-61 cents per watt, which is set to go up to $1.20 per watt, once the dumping duty is imposed. Indigenously manufactured cells cost 44-48 cents per watt. Power producers said the cost of cells coming from the US, Singapore, Canada, Japan and European Union would cost between 75-90 cents.
(Source: Business Standard, August 4, 2014)
SUZLON TO REFINANCE HALF OF ITS RS 9,000 CR DEBT IN CURRENT FINANCIAL YEAR
MUMBAI: Wind turbine maker Suzlon will refinance Rs 4,000-4,500 crore of its rupee debt and list its European subsidiary Senvion as part of its turnaround plan. Last month, the company’s international bond holders agreed on a cashless restructuring of $485 million bonds two years after the company defaulted in paying one set of bond holders. Suzlon is estimating a valuation of ^2 billion (about Rs 16,000 crore) for Senvion and 25 per cent dilution could generate about Rs 4,000 crore.
The restructuring has come as a breather for the company, which has been making a loss since FY10 with its business impacted by slowdown, removal of tax concessions for wind power in India, high interest burden and stiff competition from Chinese companies.
While on a post tax level the company continues to show negative result, Suzlon has shown positive earning before interest, tax and depreciation and amortisation (Ebitda) in last two quarters. In the first two quarters of FY15 Suzlon reported a loss of Rs 751 crore as against a loss of Rs 1,059 crore in the same period last year. It reported Ebidta of Rs 73 crore in the first quarter FY15 as against an operating loss of Rs 302 crore in the year-ago quarter.
The company has chalked out three steps to shore up its business, which are raising of volume, improve business efficiency and financial restructuring through debt refinance, equity raising and sale of non-critical assets.
(Source: Business Standard, August 4, 2014)
EIGHT COMAPANIES KEEN ON PARTNERING COAL INDIA FOR GASIFICATION
KOLKATA: Five Indian and three foreign companies have evinced interest in partnering with Coal India to undertake underground coal gasification on two blocks that the state-run monopoly is offering.
“At a recent pre-tender meeting, companies like Australia-based Linc Energy, California’s Lemar LLC, Malaysia-based Essem Group, Reliance Power, Jindal Steel & Power, Chetna Group, Gail and Maheshwari Group showed interest in underground coal gasification projects at the blocks being offered by Coal India,” a senior Coal India executive told ET.
Underground coal gasification (UCG) is a chemical process by which coal is converted to a combustible gas at the seat of the reserve. This gas is then extracted for commercial use. UCG offers a potential mean of extracting energy from deepseated coal deposits, which cannot be mined at present due to techno-economic reasons.
Coal India is offering Kaitha block, which has an estimated reserve of 166 million tonne at Ramgarh Coalfield, under the command area of Central Coalfields at Jharkhand. It is also offering Thesgora ‘C’ block, with an estimated reserve of 187 mt at Pench-Kanhan Coalfield, under Western Coalfields in Madhya Pradesh. According to the model being offered by Coal India, the gassification project will be undertaken by the service provider and it will provide a percentage of the profit to the company.
The project will have to be taken up in three stages over 25 years. The developer will examine suitability of the block through pilot well drilling in phase-I and II and, if found feasible, phase-III would be taken up.
Phase I includes exploration, phase II would be pilot assessment, while the third phase would be commercial production. There will also be an exit option after completing committed work of phase-I and phase-II without any financial liability to CIL. Entire work right from exploration to commercial development will be carried out by the identified service provider at their cost.
(Source: The Economic Times, August 4, 2014)
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