NTPC, NHPC may find it tough to exit national power exchange
NTPC, NHPC and PFC each hold 16.67% stake in the proposed exchange, while the balance 50% is with TCS. “NTPC and NHPC cannot exit the project as they have not secured other shareholders’ consent,” said PFC chairman Satnam Singh. TCS management has supported PFC’s stand.
The agreement signed between the four companies provides for a five-year lock-in from the commencement of business. Since the exchange has not yet started operations, the lock-in period remains intact. NTPC and NHPC will have to bring down their respective shareholding to below 10% to exit.
NTPC recently announced its decision to leave the project, saying the proposed exchange was inviable, given the low volume of exchange-traded electricity in the country. NHPC followed suit.
The idea to set up the proposed exchange was mooted by NTPC itself, which later invited other companies to support its initiative. The shareholders’ agreement was signed in 2008. Later, electricity regulator’s approval to run the exchange was secured in 2009. PFC and TCS, which came on the board at NTPC’s persuasion, are disappointed by its decision to exit the project. “NTPC was spearheading the initiative to launch the national power exchange. That is
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