The power struggle
During the first eight months of the current fiscal, 9,536 MW of new capacity has been declared commissioned, coming on the back of a record capacity addition of 20,501 MW added last fiscal, thanks largely due to a spirited private sector performance.
A majority of these newly commissioned generation projects do not have power purchase agreements or PPAs in place, something that has now been made a prerequisite to qualify for getting fuel linkages from Coal India Ltd. The condition to release coal linkages only against long-term PPAs is proving to be unrealistic because competitive bidding for signing of these power pacts is not happening as the requisite documents for the exercise are simply not ready.
At a time when the need of the hour is call bids from projects already under construction (termed Case 1 projects), the Ministry of Power is busy preparing bidding documents for site-specific projects (or Case 2 projects) to be built in future, such as the Ultra Mega Power Projects or UMPPs. Added to this is the rampant fuel shortage situation, amply evident from the fact that around 8,000 MW of newly commissioned gas capacity is idling currently and a similar amount of coal capacity too is either idle or operating on partial load, both for want of fuel.
With another 20,000 MW of coal-fired capacity in advanced stages of commissioning over the next few months, the clamour for fuel is only bound to get more desperate. That Coal India Ltd’s (CIL) output is trailing
Be the first to comment.
