Union power minister Sushil Kumar Shinde said on Thursday that the recent APM gas price increase would lead to commensurate hike in electricity tariff for gas-based power plants. However, there might not be any significant impact on overall tariff level.
?APM gas price increase will certainly lead to electricity tariff hike for gas-based power plants,? Shinde told reporters on the sidelines of a seminar organised by trade body Ficci here. The Union Cabinet on Wednesday approved the petroleum ministry?s proposal to increase APM gas price from $1.79 per million British thermal unit (mmbtu) to $4.2 per mmbtu in line with gas from Reliance Industries Ltd?s (RIL) D6 block in the Krishna-Godavari (KG) basin.
?We have not worked out details but tariff for gas-based power plants could go up by Rs 0.90-1.20 a unit. However, there might not be much impact on overall tariff level,? Shinde added.
?We pleaded the case of industry. However, public sector oil companies are also feeling financial pressure. The matter was considered in detail and based on that, a final decision was taken. Let us see what happens,? the power minister said.
India has installed power generation capacity of 159,648 mw, out of which 17,055 mw is based on gas.
The key power plants getting APM gas supplies are NTPC?s generating stations at Faridabad, Dadri, Anta, Auraiya, Kawas and Jhannore. Delhi?s Pragati Power and Indraprastha Power Generating Company and Gujarat Industrial Power Corporation are also getting APM gas supplies.
Dabhol power plant has got gas linkage from the D6 block. Other power plants getting gas supplies from D6 are 366 mw Lanco Kondapalli expansion project and GMR Energy?s 220 mw Kakinada power plant in Andhra Pradesh,, 108 mw Rithala and 250 mw Bawana power project in Delhi and 374 mw Utran combined cycle power project in Gujarat.
State-owned companies like ONGC and Oil India Ltd (OIL) were losing money on sale of APM gas owing to non-revision of price since 2005.