1. NTPC, Chhabra deal deadline set to be broken; here is why

NTPC, Chhabra deal deadline set to be broken; here is why

The deadline for the memorandum of understanding (MoU) for NTPC to take over Rajasthan's 1,660 MW Chhabra power plant has been extended till September from May.

By: | Published: June 27, 2017 6:57 AM
NTPC Chhabra deal, MoU, Chhabra power plant, Rajasthan's state electricity boards, modernisation of plants, power purchase agreement, NTPC's rationale, Chhabra's operational improvement, Thermal Power Plant Sources said that NTPC had earlier claimed that power prices would come down by more than 30 paise/unit after NTPC starts operating Chhabra.

The deadline for the memorandum of understanding (MoU) for NTPC to take over Rajasthan’s 1,660 MW Chhabra power plant has been extended till September from May. Sources aware of the development said that NTPC and Rajasthan’s state electricity boards have not agreed on the tariff at which the plant would be selling power to the state after the proposed NTPC take-over.

Sources said that NTPC had earlier claimed that power prices would come down by more than 30 paise/unit after NTPC starts operating Chhabra. In order to improve the plant’s functioning, NTPC agreed to renovate and modernise the plant. However, it was found that modernisation of the plant would raise tariffs by about 10 paise/unit, sources said. Currently, the Chhabra plant sells power at R3.42/unit. The plant had operated at a plant load factor (PLF) of 78%. However, in May it operated at a low PLF of 51.4% and produced 382.7 million units (MU) in against the target of 783 MU.

Other sources added that Rajasthan distribution companies are not willing to sign power purchase agreement (PPA) with NTPC at the new rates. NTPC has asked the state to guarantee at least a minimum amount of power offtake, which would make it viable for NTPC to run the plant. Rajasthan utilities have not agreed to the proposal yet. Instead, they insist on buying power from Chhabra as per the merit order list. Sources said that since tariffs would go up after renovation works, chances of selling power from the merit order would be lower, hence defying NTPC’s rationale of investing in Chhabra’s operational improvement.

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Chhabra plant currently operates at a high station heat rate, which means that it consumes more coal than other plants to generate electricity. NTPC’s main target was to lower the average station heat rate of the plant, sources said. “NTPC takes over Chhabra Thermal Power Plant of Rajasthan; will help to improve efficiency and lower tariff,” power minister Piyush Goyal had tweeted after the MoU was signed in January.

NTPC had signed an MoU with Rajasthan Rajya Vidyut Utpadan Nigam and Rajasthan Urja Vikas Nigam to take-over the Chhabra plant in January this year. NTPC was supposed to pay Rs 700 crore, and take over the plant’s debt of about Rs 3,200 crore.

  1. S
    SCMehta
    Jun 28, 2017 at 7:27 am
    NTPC is profitable only due to being Center PSU,as it commands all Center rules regulations. If the perks facilities of NTPC RVUNL compare, RVUNL Employees working at 1/3, even their plants output is comparable. This is a Center pressure deal.If BJP is so fair, NTPC should take over whole RVUNL, not one of its plant. As far as SHR of CTPP is concerned, it is the situation when under influence of govt, RERC has increased allowable SHR despite no technical grounds. Definitely tariff will not lower, even if NTPC take over this plant, but unrest among RVUNL Employees will raise.
    Reply
    1. G
      Guru Prakash
      Jun 28, 2017 at 11:37 pm
      Each NTPC EMPLOYEE WORK EQUIVALENT TO >3Govt RVUNL EMPLOYEES AND WITH LESS DEPENDENCY OF ANNUAL MAINT. Contracts
      Reply

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