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January 17, 2014

Tata Power Claims to Charge Lowest Power Tariff in Mumbai…

 

Tata Power Claims to Charge Lowest Power Tariff in Mumbai…

As the demand to reduce power tariff gaining momentum in Maharashtra, private utility Tata Power today claimed that its tariff is the lowest in the metropolis.   

The company, which has a residential consumer base of 4.5 lakh in the city, charges a tariff of Rs 2.13 per unit from customers consuming power up to 100 units with a fixed charge of Rs 40 and Rs 3.62 per unit and fixed charge of Rs 75 for up to 300 units, the Tata Power Company (TPC) said in a statement issued here today. 

It said that while Reliance Infrastructure (RInfra) charges an average Rs 5.68 per unit within 250 units, BEST charges Rs 4.52.    

RInfra has the largest number of low-end customers followed by BEST and TPC. While RInfra supplies power to over 18.8 lakh low-end households, TPC has 2.94 lakh customers and BEST 6.53 lakh.      

The demand to reduce power tariff in Maharashtra gained momentum after the Aam Aadmi Party (AAP) announced a 50 per cent cut in electricity tariffs in Delhi soon after forming the government in December.   

Maharashtra Chief Minister Prithiviraj Chavan today said the state government will soon make an announcement in connection with reduction of power tariff.

Elections to the Maharashtra Assembly are scheduled to held in September and October.

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OHPC surpasses annual power generation target…

 

OHPC surpasses annual power generation target…

Odisha Hydro Power Corporation (OHPC), which was mandated by Odisha Electricity Regulatory Commission (OERC) to produce 5,676 million unit (MU) hydropower in the current fiscal, has surpassed its annual target and aims to generate 1,000 MU more by the end of March 2014.

“As of 14 January, we have produced 6,004 MU, higher than our target of 5,676 MU. Considering current reservoir positions, we can generate nearly 500 MU more by end of March,” said Santosh Sahu, director (finance) of the state government undertaking.

The rise in power generation was supported by low pressure-induced rains that lashed the southern part of the state towards the fag end of monsoon season that ended in October 2013. As a result, major reservoirs, which are located at Koraput , Malkanagiri and south of Bhawanipatna districts, have ample water to generate record power generation.

Major reservoirs of the state, which supply water to these plants are near their highest level, OHPC website updates showed. Balimela reservoir currently has water at 1508 feet, out of its maximum carrying capacity at 1516 feet, while Mukhiguda reservoir contains 641.8 feet high water, against carrying capacity of 642 feet. Bariniput reservoir, which has a maximum capacity of 858 feet , now has 855.6 feet water in it.

Total hydro power generation, which was around 1200 Mw per day in November however, has come down to 500 Mw average per day as water is being used for irrigation of winter crops from the reservoirs.

Largest power plant Balimela generated about 165 Mw electricity , while Upper Indravati produced 114 Mw power on an average by the second week of January. Hydro power generation at Upper Kolab power station was around 70 Mw by mid-January, data showed.
Balimela has the capacity to produce 510 Mw, Upper Indravati 600 Mw and Kolab can produce 320 Mw electricity.

OHPC said higher generation means more profit for the company, which could jump by as much as 50% to Rs 75 crore.

“During 2012-13, our profit after tax (PAT) was Rs 47 crore. This year we are expecting Rs 75 crore due to higher power generation,” said Sahu.

As per OERC guidelines and agreement signed with Gridco, the hydro power producer has to sell additional power generation at half of the agreed rate. For 2012-13, rate of average power sold by OHPC has been fixed at 70 paise per unit upto sell of 5676 Mu power. Any power sold beyond the targeted generation has to be sold at not more than 35 paise.

The Indian Meteorological Department (IMD) said while worst-hit Ganjam received 740 mm rainfall during and after the tropical cyclone Phailin, causing flood situation in the district, compared with 111 mm normal rainfall, Odisha received 277% higher rainfall than normal in October.

Odisha needs about 3,000 Mw power in summer season. Hydro power production, which is at 500 Mw now, can rise to 1000 Mw in summer, the state-run power generator said. “The current water availability will be sufficient for summer demand of 2014,” said the OHPC official.

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Korean power firm ties up with Jinbhuvish for Rs 3450-cr Maharashtra power project…

 

Korean power firm ties up with Jinbhuvish for Rs 3450-cr Maharashtra power project…

Korean South-East Power Company (KOSEP), a subsidiary of Korean state-owned power generator Korea Electric Power Corporation, today signed an initial agreement with Mumbai-based Jinbhuvish Group for technical support for its Rs 3,450 crore project in Maharashtra.

The 600 Mw power plant, being set up in Yavatmal district, is likely to be commissioned in 2016. KOSEP holds a 40% equity stake in the coal-based project. Lenders for the venture include Rural Electrification Corp (REC) and Power Finance Corp (PFC) and PTC India Financial Services (PFS).

“The Yavatmal venture is one of the few thermal projects in India being set up in a JV with foreign investment. All major clearances have been received and the construction activities will commence soon,” Jinbhuvish Group Chairman Manish Mehta said.

Seoul-headquartered KOSEP owns and operates thermal projects with a combined capacity of 8,396 Megawatt, around 12% of total electricity sales in Korea.

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Power bourses asked to show supply-demand curve on websites…

 

Power bourses asked to show supply-demand curve on websites…

To ensure more transparency, sectoral watchdog CERC has asked power exchanges to display on their websites aggregate demand and supply curve of electricity trading for day-ahead market.

The move, according to the Central Electricity Regulatory Commission (CERC), would help market players in making informed decisions.

Indian Energy Exchange (IEX) and Power Exchange India Ltd (PXIL) are the two electricity bourses in the country, with the former having more than 90 per cent market share.

"The proposal for display of aggregate demand and supply curve would be a positive step towards development of power markets.

"This would significantly contribute towards information dissemination, bring transparency in the markets and help market participants to take informed price decisions," CERC has said.

The directions would be applicable for day-ahead electricity trading market, starting from April 1 this year.

In the day-ahead market, participants transact electricity on 15-minutes block basis, a day before its delivery.

"The curves shall be available on the website for a period of one year from the date of publication. This shall be implemented for the results of day ahead auction held on 1.4.2014," the order said.

The watchdog, in its order on January 8, has asked the bourses to display on their respective websites the national level aggregate demand and supply curves -- price and quantity -- after completion of auction and final price discovery.

Noting that curves should be displayed for each 15 minute time block of the day, the regulator said exchanges should not display information about any individual participant.

As per the regulator, the demand and supply curve should be displayed at the same time when the final prices results for day ahead market are published on the website.

"This information shall be over and above the cleared prices of different bid areas presently being displayed for the day ahead markets," it added.

The power exchanges have also been asked to closely monitor the market and monitor the bidding behavior of participants to check whether any market abuse is happening.

In September last year, CERC had sought comments on a discussion paper titled 'Improvement of market efficiency by information dissemination through display of aggregate demand and supply day ahead curves by power exchanges on their website'.

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Power gencos seek relief on CERC’s draft multi-year tariff norms…

 

Power gencos seek relief on CERC’s draft multi-year tariff norms…

Power generation companies (Gencos) have sought relief from the electricity regulator on many of the regulations that came out in the draft multi-year tariff (MYT) regulations 2014-2019.

The final draft is likely to come in a month’s time. Among those, the power gencos, like NTPC , have asked CERC (Central Electricity Regulatory Commission) to allow them plant-availability-based incentive.

Earlier, power gencos got incentives over and above the fixed cost charges that they would get in cases when plant was available for power generation.

However, under the new draft, CERC has removed these incentives, stating that incentives will only be given if plant is generating the power to distribution companies (discoms). Thus, the incentives have got generation-linked from being availability-linked.

The change of the structure from availability to production puts the onus on generators, which according to experts, have to pay a price due to the inability of the distributors to buy power from them. But the distribution companies have contested this saying that power generation companies get unnecessary advantage, and are seeking for capping these incentives.

Over and above the fixed charges, NTPC alone used to recover Rs 600 crore as incentives annually. The power gencos have also sought for easing the operating and maintenance parameters and reducing the proposed cap for station heat rate as proposed in the draft norms. Station heat rate (SHR) is fuel required to make one unit of power.

And CERC in draft MYT had capped SHR by 2% to 2,375 kcal/kwat hour for 500 MW of power, since according to CERC this would increase their efficiency. NTPC has also sought for 18% minimum assured return on equity, an increase from what was proposed in the draft where the ROE was capped at 15.5%. One of the key highlights was a proposal in the draft to remove the tax arbitrage for power generation companies like NTPC, which earned around Rs 500 crore yearly as tax arbitrage.

The power gencos have requested CERC to remove this regulation from the draft and continue with the earlier one. Experts say that a pre-tax ROE for companies like

NTPC would ensure higher cash flows and a better balance sheet. Discoms, on the other hand, have presented to the central electricity regulator to use the interest income earned by companies like NTPC, which is as high as Rs 2000 crore, to set off the tariff reduction.

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NTPC Board okays Rs 12,532 crore investment for Odisha plant…

 

NTPC Board okays Rs 12,532 crore investment for Odisha plant…

State-run NTPC's Board today approved an investment of Rs 12,532.44 crore for setting up 1,600 MW thermal power project in Odisha.

"The Board of Directors of NTPC have accorded an appraised current estimated investment approval for Darlipali Super Thermal Power Project, to be implemented in Odisha at an estimated cost of Rs 12,532.44 crore," NTPC said in a statement.

This approval is subject to environmental clearance. This approved investment is more than the earlier estimated cost of the project due to increase in land compensation, a company official told PTI.

The project requires approximately 1,600 acres of land. It is linked to the Dulanga coal mine, with seven million tonnes capacity, in Odisha.

The company recently signed an initial agreement with the Geological Survey of India to set up a geothermal power project at Tattapani in Chhattisgarh.

NTPC's current installed generation capacity is 42,454 MW. The company plans to add about 20,000 MW by 2017.

It has about 1,500 MW of hydro power capacity under construction and operates about 4,000 MW of gas-based power plants in the country.

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January 16, 2014

Final price bids for Odisha, Tamil Nadu UMPPs to open on 26 February…

 

Final price bids for Odisha, Tamil Nadu UMPPs to open on 26 February…

The final price bids for the two ultra mega power projects (UMPP)—Odisha and Tamil Nadu—will open on 26 February, power minister Jyotiraditya Scindia said on Thursday.

The minister said that the projects will be awarded to the successful bidders post opening of the financial bids.

All the nine applicants for Odisha UMPP and eight applicants for Cheyyur UMPP (Tamil Nadu) who have applied for request for qualification (RFQ) have been shortlisted for issuance of request for proposal (RFP), or the final price bids.

Power Finance Corporation (PFC) is the nodal agency for UMPPs in the country. UMPP is coal-based thermal power project that have 4,000 megawatt (MW) of generation capacity.

The apex evaluation committees cleared all the technical bids in the first round. Both the committees are headed by V.K. Shunglu, ex-CAG.

NTPC, Tata Power, NHPC, Adani Power, JSW Energy, Jindal Power (an arm of Jindal Steel and Power), Sterlite Infraventures, CLP India and Larsen & Toubro (L&T) had submitted applications for the Odisha project.

NTPC, Adani Power, CLP India, GMR Energy, Jindal Power, JSW Energy, L&T and Sterlite Infraventures had submitted bids for the Cheyyur UMPP in Tamil Nadu.

Odisha UMPP is a pit-head power project. Based on domestic coal to be sourced from allocated captive coal blocks, it is expected to cost around Rs25,000 crore.

The Cheyyur UMPP is a coastal power project, based on imported coal, with an expected investment of about Rs24,200 crore.

So far, four UMPPs have been awarded, of which Sasan (Madhya Pradesh), Krishnapatnam (Andhra Pradesh) and Tilaiya (Jharkhand)—have been bagged by Reliance Power. Tata Power is operating the Mundra UMPP in Gujarat.

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Power Grid to invest Rs 472 cr in two projects…

 

Power Grid to invest Rs 472 cr in two projects…

Power Grid Corporation of India will invest more than Rs 472 crore in two projects.

The investment plans were approved by the transmission utility's board of directors at their meeting held on January 13, PGCIL said in a regulatory filing today.

The two projects are estimated to cost Rs 472.58 crore.

An investment of Rs 374.63 crore will be made in 'Phase-I of Unified Real Time Dynamic State Measurement (URTDSM) Project', which is expected to be completed in 27 months.

Besides, the state-owned company will invest Rs 97.95 crore in 'Transmission System associated with contingency plan for evacuation of power from IL&FS (2x800 MW)'. This project is expected to be commissioned within 18 months from the date of investment approval.

Shares of the company rose nearly 1% to Rs 98.30 in afternoon trade on the BSE.

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AP to ink MoU with UK govt on energy conservation…

 

AP to ink MoU with UK govt on energy conservation…

Andhra Pradesh government will soon sign a memorandum of understanding with the government of UK for collaboration on energy efficiency and low-carbon growth.

The MoU will see UK extend technical support for the state to implement the best practices vis-a-vis energy efficiency and conservation.

With the assistance of the British High Commission, AP government is also preparing a comprehensive roadmap for improving energy efficiency, said the Chief Secretary and State Energy Conservation Mission (SECM) Chairman, Prasanna Kumar Mohanty.

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Dec quarter likely to be weak for Power Utilities sector: Credit Suisse…

 

Dec quarter likely to be weak for Power Utilities sector: Credit Suisse…

The third quarter ended December 2013 is likely to be weak one for the utilities sector in the country, according to outlook presented by Credit Suisse India Research.

Providing insight into the third quarter ahead of the corporate sector coming out with their earnings reports, Credit Suisse expects states, “We expect the third quarter of 2013 to be another weak quarter for most Indian utilities. While Adani Power, JPVL, KSK and Lanco are likely to report losses, NTPC and NHPC's profitability is expected to decline anywhere between 1-5 per cent year on year. And that of the Tata Power's profitability is expected to decline year on year.”

Adani Power is likely to report a loss as Mundra project Power purchase agreements (PPAs) have to be honoured status quo pending Central Electricity Regulatory Commission (CERC's) final decision on compensatory tariff. For Lanco, low plant load factor (PLF) and Griffin's continuing losses could result in loss in during third quarter.

With regards to NTPC, the analysts from Credit Suisse in their report state that the recurring profit after tax (PAT) to remain almost flat year on year. The status on captive coal production, imported coal supplies to Farakka/Kahalgaon projects, railway infrastructure issues at Mouda project along with any update on discussions with CERC on upcoming tariff regulations are key factors to watch.

In the case of Reliance Power’s Rosa project profitability is expected to remain robust but with Sasan ultra mega power project (UUMP's) units presently getting capitalised, recurring profit is expected to grow.

In the case of Tata Power, losses in Mundra UMPP's are expected to continue. Pending CERC's final decision and the profitability in the coal business is expected to decline due to correction in international coal prices.

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