NTPC’s low PLF due to weak demand from discoms: Nomura

By: |
March 15, 2016 12:14 AM

According to the latest available generation data from the Central Electricity Authority (CEA) – the Tentative monthly generation report for Feb 2016...

According to the latest available generation data from the Central Electricity Authority (CEA) – the Tentative monthly generation report for Feb 2016 – the PLF (plant load factor) of NTPC’s overall wholly-owned thermal capacity was 75.7% in Feb 2016 (vs 71.9% in Jan 2016 and 78.9% in Feb 2015).

NTPC’s wholly-owned coal-fired PLF was 82.1% in Feb 2016 vs 79.0% in Jan 2016 and 85.3% in Feb 2015. Seven plants saw an uptick in PLF sequentially, whereas eight plants (17.1GW) were in the incentive zone (ie, 85% PLF), ie, similar to the situation seen in Jan 2016.

PLF at Mauda-I (2x500MW) was 18%, as one unit of the plant was partially operational during the month (the plant has been idling for the last two months due to lack of demand). For Barh-II (2x660MW), Unit-II began commercial operations on 18 Feb 2016, PLF was 49%; PLF at Unit-I was 69% (vs 68-76% range seen over the last three months).

PLF of NTPC’s gas-fired capacity was 22.7% in Feb 2016 vs the all-time low of 13.3% seen in Jan 2016 (26.0% in Feb 2015); although PLF was up sequentially, it was 350bp below the YTD average for FY16 (Apr-Jan PLF at 26.2%). We believe the low PLF levels are due to slackness in demand from Discoms, plus the variable cost of gas-fired electricity not ranking high in the ‘merit order dispatch’.

The PAF of its gas-fired capacity was 99.5% vs 100.0% in Jan 2016 and 94.9% in Feb 2015.

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