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  1. Generation project delays affect PowerGrid’s pace

Generation project delays affect PowerGrid’s pace

The company is slowing down execution in some projects to avoid NPAs and burdening consumers

Published: January 2, 2015 3:09 AM

The article “PowerGrid wins in ministry’s U-turn” (FE, December 26, 2014) says that PowerGrid’s track-record in timely delivery of transmission projects has been dismal and a number of projects have been delayed. But PowerGrid is consistently getting excellent MoU rating from the government as it has generally achieved/surpassed all targets assigned to it. According to Platts, PowerGrid has been rated as the fastest growing electric utility globally.

PowerGrid is executing 80-90 projects concurrently. Since FY11, PowerGrid has completed transmission projects worth R60,760 crore involving 30,000 ckm of EHV lines and 63 new EHV substations with a total transformation capacity of 1.24 lakh MVA. In FY15 itself (last nine months), about 6,500 ckm of EHV lines, with about 20,000 MVA of transformation capacity, have been added.

The transmission projects covered in the article are primarily associated with the generation projects which themselves are getting delayed.

Thus, it is prudent on the part of PowerGrid to slow down the execution pace to the extent possible to avoid NPAs and burdening consumers.

The transmission lines related to Vindhyachal-IV and Rihand-III were delayed because of delay in land acquisition of Vindhyachal Pooling Station. In this case, part of the system has been completed and commissioned to avoid any bottlenecks in evacuation from these generation projects.

The article talks about shortage of power in the southern region and power could not be transferred from power-surplus Chhattisgarh to the southern region due to delay of transmission system by PowerGrid. But the southern region is facing acute shortage of power due to delay of about 8,000 MW generation projects—Kudankulam (2,000 MW), Krishnapatnam UMPP (4,000 MW), Tuticorin JV (1,000 MW), Neyveli TS-II expansion (500 MW) and Kalpakkam PFBR (500 MW). The problem has been compounded due to non-availability of gas for about 7,000 MW projects in Vemagiri of Andhra Pradesh.

As a large number of generation projects were planned for commissioning in the southern region during the Eleventh Plan, resulting into a power surplus region, no discoms of southern region applied for long-term access to the region. Of the 22,000 MW total long-term access sought by IPPs in Odisha and Chhattisgarh, only 550 MW target to the southern region was sought. Raichur-Sholapur transmission system was envisaged for transfer of power from the southern to the western region; but the line has become a lifeline to the southern region because the generation project could not come up.

PowerGrid has taken prompt action to complete eight high capacity transmission lines to facilitate power transfer to the southern region. To enhance interregional transfer capacity, a large number of interregional links including Raigarh-Pugulur-N Trichur 800 kV 6,000 MW HVDC line have been taken up for implementation on war-footing by PowerGrid.

The article says that awarding transmission projects to PowerGrid on nomination basis could mean private sector will lose opportunity for developing ISTS. But, as per the current government guidelines, all interstate transmission projects are to be implemented with tariff-based competitive route, with few exemptions like transmission projects required in compressed time schedule. When transmission projects are required urgently and implementation involves technical challenges, the decisions are taken on nomination basis to PowerGrid, as the central transmission utility, so that these are completed in shortest possible time.

Being new entrants in the transmission sector, private companies are facing numerous challenges in completing the projects assigned to them.

Of the 14 projects awarded to the private sector, few have been completed, one of which is the Raichur-Sholapur 765kV line. This line has been completed six months behind schedule, that too with the full assistance and deployment of adequate resources of PowerGrid. Most projects awarded under tariff-based competitive bidding are running late; few could not take off even after significant time from the date of award.

These delays are due to several factors, some of which are procedural. The power ministry has taken steps to streamline the procedure for transmission licensees including that of forest clearance so that implementation can be accelerated.

Keeping this in view, PowerGrid’s performance has been exemplary. Only few transmission projects encounter time overrun on account of ROW, land, forest, wildlife, etc. In such cases, alternative arrangements are made so that power evacuation is not affected. Also, only those projects are being assigned to PowerGrid on nomination basis which are critical and complex in nature and which require urgent implementation for smooth operation of the grid. For tariff-based competitive bidding, adequate number of transmission projects worth about R38,000 crore are on the anvil. So, there is no dearth of opportunity for investment in the transmission sector.

By Chetan Verma
The author is general manager, Corporate Communications, PowerGrid

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  1. A
    Atul
    Jan 5, 2015 at 10:53 am
    POWERGRID has done commendable job during last 25 years. One of the proof is its share value.
    Reply

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