Clearance delays hit 80% of thermal power projects

Sep 06 2012, 15:37 IST
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The power sector, both in the generation and distribution segments, continues to operate under several inefficiencies.   (Reuters) The power sector, both in the generation and distribution segments, continues to operate under several inefficiencies. (Reuters)
SummaryDelay in regulatory clearances are hampering the commissioning schedule of 80 per cent of the thermal power projects, says a study.

Delay in regulatory clearances are hampering the commissioning schedule of 80 per cent of the thermal power projects, says a study.

"Eighty percent of the coal-based power projects in the private sector are far behind the schedule of commissioning primarily due to regulatory clearances," according to an Assocham study.

Another 20 per cent of them, though on schedule so far, are threatened with delay if various issues relating to policy framework and uncertainty over coal linkages continue to prevail, it said.

Excepting a handful of projects being promoted by the Tatas, Reliance Power, O P Jindal and India Bulls, most other projects are running behind schedule, it said.

In fact, different units of the Tata Power at Mundra in Gujarat are running ahead of schedule, even though the power sector is facing a severe problem of expensive coal, it said.

The study added that the total capacity addition to be achieved by the private sector projects, only about 7,000 MW will be commissioned in sometime around the end of this year and the next year, while there could be long delays for the rest of about 44,000 MW planned in the 11th Plan.

"This is rather bad news, especially when India is a big energy deficit country and the industrial production is down and the investment sentiment weak," said Assocham President Rajkumar N Dhoot said.

The power sector, both in the generation and distribution segments, continues to operate under several inefficiencies Ė which are low level of the plant load factor and high level of transmission and distribution losses.

Then, there are issues of coal linkages and the regulatory hassles such as environment approvals.

"Under these circumstances, we face a big challenge of reviving the sector which only can be engine of the India story. Without power and electricity we face a dark and uncertain future, which the country can ill-afford," the study added.

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