PSERC passes on customs duty benefit of Rs.600 crore to consumer...

 

Punjab State Electricity Regulatory Commission (PSERC) has decide to pass on custom duty benefit of Rs. 600 crore availed by Sterlite Energy limited on account of grant of mega power project status to Talwandi Sabo thermal project be passed on to consumers.

PSERC in its order of December 27 on petition no. 41 directed the Sterlite Energy limited executing theTalwandi Sabo thermal project to render true and full account of benefits to PSPCL that ought to have accrued to it on account of grant of mega power status to project.

The Punjab consumer is going to benefit to the tune of Rs. 104 crore per annum for the next 25 years as the fixed charges of project will come down by 8 paise per unit. With a generation potential of the plant being 13000 million units, the Punjab consumer shall gain by Rs. 2600 crore over a period of next 25 years.

PSPCL has filed a petition before Commission seeking directions to Sterlite Energy limited on account of mega power status granted to 1980 MW Talwandi Sabo project and pass on all financial benefits claimed to PSPCL as per power purchase agreement.

PSPCL has claimed that the benefits of status were not applicable at the time of bidding in 2006 as per existing laws .In December 2009 Government of India revised the policy guidelines and modified the mega power policy. Talwandi Sabo thermal project was granted this status in August 2010.

Punjab Government issued the essentiality certificate to obtain necessary customs duty benefits and the company executing the project gave the undertaking and claimed all the benefits The company claimed that it is not liable to pass the benefits of new policy to PSPCL claiming that this was not a change of law. The benefits were granted to keep the power tariff low in the public interest.

Sterlite has been benefitted to the tune of Rs. 600 crore for duty draw back the non - payment of customs duties. As per article 13 of power purchase agreement the fixed charges of 135.4 paise per unit comes down by 8.064 paise per unit.
Similarly the Commission had granted a relief of Rs 74 crore per annum last November from power generated from Rajpura thermal plant on similar grounds thereby passing on a benefit of 8 paise per unit totaling to Rs.1850 crore to the consumers over next five years.
Round up of PSERC in 2013
Punjab consumer is going to gain about Rs. 300 crore during 2013-14 on as an impact of fuel audit conducted by PSERC for reducing the use of coal and other fuels at PSPCL thermal plants. This will reduce tariff by about 7.5 paise per unit.
Thus the vigilant eye of PSERC on private and PSPCL thermal plants is likely to reduce the electricity tariff by about 23.5 paise per unit during 2014-15, thus reducing the burden of 63 paise per unit proposed to be passed on to the consumer by PSPCL to 40 paise per unit.
According to In case PSERC applied the regulations strictly on PSPCL ‘s ARR petition in stringent manner ,there is a possibility of reducing the tariff during 2014-15 keeping in view the profit of PSPCL and PSTCL during 2012-13 and 2013-14 . These sources indicate that courtesy consistent tariff rises given by PSERC, the profits of PSPCL and PSTCL during last 2 years have crossed a figure of few hundred crore which the companies are hiding from the public to manage a rise in tariff during 2014-15.

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Punjab to soon inaugurate Talwandi Sabo and Rajpura thermal power Plants...

 

Punjab Government to soon inaugurate the 660 MW Talwandi Sabo Thermal Plant and Rajpura Power Plant; however the actual generation from these plants to start in the year 2014.

The government has fixed November 25 for inauguration of the 660 MW unit of the Talwandi Sabo plant, while the Rajpura plant will be dedicated to the people on December 8, the birthday of chief minister Parkash Singh Badal.

 

The government intends to inaugurate the two plants before the investors' conclave scheduled for December 9 and 10.

Sources said though the two plants would be inaugurated this year, the real power generation -- synchronisation of the units with the National Grid, would take place in January next year.

"The private company will only light up the boiler on November 25 and it will be declared as inaugurated," said a PSPCL official dealing with the private units. No plan of synchronisation of the units, which meant the real generation, had been submitted to the PSPCL or the Northern Grid, he added.

He said attaining synchronisation is a cumbersome process that would take at least a month. "After going through various processes when the unit runs on full capacity for 72 hours, only then the Northern Grid controlling agency allows synchronisation. So it will take at least a month to 40 days for synchronisation of the first unit of Talwandi Sabo," said the official.

The work on the chimney of the Talwandi Sabo plant was recently completed, while the last-minute checking to light up the boiler is on.

When contacted, PSPCL CMD KD Chaudhari said, "November 25 is a big day for Punjab as after a gap of 30 years another unit will be inaugurated. There is a set procedure of synchronisation that one has to follow. The commercial generation will start by December end, though the plants will become operational by November 25 and December 8."

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Power from private plants to cost more in Punjab...

 

Punjab may be declared power surplus after commissioning of two thermal units in the private sector in the near future but the electricity tariff is going to increase.

Owing to less allotment of indigenous coal, the private power plants will import it from abroad and will pass on the extra cost to the consumers. The power with the imported coal (35% of the total) will cost 35 paise per unit more to consumers.

As per the Punjab State Power Corporation Limited (PSPCL) analysis, in case of use of imported coal with landed cost of around Rs. 10,000 per metric tonne, the price per unit may increase to around Rs. 3.96 as the imported coal with Indian coal is to be blended in ratio of 30:70 resulting in a net increase of about 35 paise per unit in energy charges.

PSPCL has prepared itself to file the Annual Revenue Requirement (ARR) petition before the power regulator.

Appellete Tribunal of Electricity (APTEL), as per an earlier decision, has already allowed that private power plants can charge the state governments for the extra expenditure on imported coal.

In view of that, Larsen & Toubro, the firm executing the Rajpura thermal plant, had sought the approval of the Punjab State Electricity Regulatory Commission (PSERC) for procurement of coal from alternative sources (imported coal) and passing through the landed cost of such coal in tariff under the power purchase agreement through a petition.

As disclosed by a senior PSPCL official, L&T in their petition to PSERC has submitted that the lowest price quoted by a consortium for importing coal was Rs. 10,000 per metric tonne. PSPCL had attended the tender opening, as per the officer. The petition also sought passing on of the cost of washing of coal and transportation cost of coal from Sirhind to the site of the plant as the railway line to the plant is still incomplete.

PSERC did not admit the petition and said that L&T is yet to negotiate the price of coal with the tender company for further reducing it and has observed that on the remaining two issues, L&T will have to go as per PPA. The Commission has directed PSPCL to remain associated with L&T in process of negotiations for importing coal to get lower prices.
 

Power plant           Tariff (Rs/unit) with 100%    Tariff with 35%
                                    indigenous coal               imported coal

Talwandi Sabo                3.62                                     3.96       
Rajpura                          3.37                                      3.69   
Goindwal                       3.63                                     4.05

 

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Power crisis looms large in Punjab as supplier set to stop sending coal...

 

Power crisis is staring at Punjab as all three thermal electricity plants of the state have failed to meet the generation target set by the Central Electricity Authority (CEA) in October, after the main coal supplier drastically cut down fuel supply to these.

The supplier has also expressed inability to continue sending the fuel after mid-November, citing political agitations at the mine site in Jharkhand.

Anticipating stoppage of coal supply for the state's thermal plants, the Punjab State Power Corporation Ltd (PSPCL) had shut down seven of its 14 units in phases during the last month, leading to a drop in the power output, sources said.

Against the target of 267 and 624 million units, Guru Nanak Dev Thermal Plant, Bathinda and Guru Hargobind Thermal Plant, Lehra Mohabbat, could generate only 161 and 451 million units respectively. Both plants met only 60% and 70% of their generation targets respectively.

Only Guru Gobind Singh Super Thermal Plant, Ropar had performed better by managing to achieve 98% of the CEA target.

Senior PSPCL officials revealed that the problem arose after Panem Coal Mines Ltd, a joint venture of PSPCL and a Kolkata-based company EMTA, drastically reduced coal supply from its Pachwara (central) mine in Pakur district of Jharkhand since the past one year, citing agitations led by state's former chief minister Babulal Marandi.

Officials revealed that while the company had supplied 70 lakh tonnes of coal to Punjab against the approved mining plan of 90 lakh tonnes in 2012-13, coal supply had reduced to a meagre 32 lakh tonnes during the first seven months in 2013-14.

Citing the "adamant attitude" of PSCPL authorities, Panem Coal Mines Ltd authorities had recently sent a letter to the Powercorp, asking it to take charge of the mine after November and urging it to deal directly with the agitating parties at the mine site.

Panem authorities said that coal, currently lying extracted, would be dispatched to Punjab's power plants by mid-November after which, it would be the responsibility of PSPCL to run the mine.

Panem had supplied 2,216 rakes in 2011-12, 1,820 in 2012-13 and 849 rakes till October this year for thermal plants of the state.

On the other hand, authorities maintained that the thermal units had been shut down due to availability of cheap power from other sources. However, officials revealed that PSPCL was purchasing power at higher rates than the cost at which it was being produced by its own plants.

"Average cost of power purchased during October 2013 is Rs 3.6 per unit. However, Lehra plant produces power at Rs 2.2 per unit, Ropar at Rs 2.5 per unit and Bathinda at Rs 2.65 per unit approximately," said a PSPCL official.

Chairman-cum-managing director (CMD) K D Chaudhuri and director (generation) G S Chhabra of PSPCL could not be contacted, despite repeated attempts.

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