1. Old sites can’t house Ultra Mega Power Plants

Old sites can’t house Ultra Mega Power Plants

Urbanisation claims land at sites of older power plants

By: | New Delhi | Updated: November 16, 2015 12:37 AM
Power lenders, REC, PFC

The power ministry has been hoping to address delays in land acquisition for UMPPs by setting up mega power stations, of 4,000 MW each, at sites where older power units are located. (Photo: Reuters)

Plans to build a clutch of ultra mega power plants (UMPPs) at the sites of vintage coal-based stations could come a cropper with surplus land having been eroded by rapid urbanisation. Moreover, the Central Electricity Authority (CEA), which was mandated to examine the feasibility of the proposal, has voted against it. However, it’s possible super-critical units, rather than UMPPs, could be built at some locations.

The power ministry has been hoping to address delays in land acquisition for UMPPs by setting up mega power stations, of 4,000 MW each, at sites where older power units are located.  Records show these units, all of 25 years or more, hold huge surplus land. However, if state governments’ reports are to be believed, these land parcels have largely been encroached upon over the years, leaving little land that can be used. If UMPPs were to be built at these sites —  a dozen of them were identified by the power ministry — environmental clearances would have come in faster.

Official sources citing CEA’s report said none of the state governments had expressed the willingness to replace old and inefficient units with UMPPs. The CEA had recommended replacing a few of the old plants with super-critical thermal units of 650 MW and above, but state governments say there is neither enough land nor water resources.

The authority, in its report submitted to the power ministry last month, also shortlisted 8,200 MW of state-owned capacity and 1,980 MW of Centre-owned capacity that could be replaced by new super-critical plants. The CEA had studied old coal-based thermal stations with combined capacity of 10,000 MW.

Gr5

Earlier this year, the country’s largest thermal power generator, NTPC, entered into an agreement with Jharkhand to develop its 840-MW Pataratu-based thermal power station into a UMPP-sized plant. Under the plan, NTPC will hold 74% in the joint venture. The CEA, sources said, opined that this NTPC model cannot practically be replicated by other old plants. “None of the proposals made by the CEA was accepted by states, as they argued that during the course of these plants’ lives, the surrounding areas have seen much development over the years, rendering the process of land acquisition impossible,” a CEA official told FE.

The government’s ambitious UMPP project is hamstrung, as two of the original four UMPPs awarded between 2007-09 have so far become functional. While Reliance Power has scrapped the PPA for the Rs 36,000-crore Tilaiya UMPP, citing undue delays in land acquisition — only 20% of the required land was handed over to the company during the last eight years. Last year, Power Finance Corporation, the nodal agency in charge of bidding for UMPPs, had to scrap the process for two other projects due to lukewarm response from private developers.

The CEA said in its report: “The data shows that large number of units had PLF over 90 % in the year 2014-15 and consistently over the last three years. These include several 110-MW units which are 31 years of age. Amongst the 200/210-MW and 500-MW capacity group, the average PLF for 2014-15 was 68% and about 6,000-MW capacity had PLF of over 85 %. The average PLF for 500MW group has been 82%.”

The CEA concluded that the efficiency gains with technology substitution to super-critical were not significant and a much higher potential of efficiency improvement existed through better operational practices in large number of stations — both old and new. In short, only 30% of the old capacity qualified for conversion to supercritical technology. “The operating practices are the single most important factor responsible for the performance achieved and considerable improvements in performance are possible with good operating practices,” CEA said.

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