To fast-track the construction of transmission lines, the power ministry has proposed a compensation rate of 85 per cent of the value of land acquired for its fulfilment. Issuing guidelines for the payment of compensation for damages on the right of way, the ministry says that this land value will be determined by the district magistrate or the relevant authority. The percentage of compensation will be based on circle or other applicable rates for the tower base are which is impacted as a consequence of the erection of a pylon structure. Additionally, compensation up to 15 per cent of the land’s value will be paid towards its diminution in the width of an ROW corridor for the laying of transmission lines and the imposition of certain restrictions. Based on the categorisation of the land in question, the states will have the authority to decide the compensation. However, this compensation will only be available for transmission lines which are supported by a tower base of 66 kilowatts and more. Transmission lines below this stipulated figure, as well as sub-transmission lines, are completely excluded from the ambit of these guidelines. These guidelines have been framed based on a report that had been submitted by a committee headed by the special secretary of the power ministry. This report recognised that the Power Grid Corporation of India and states faced various difficulties the construction of transmission lines primarily because of issues related to the right of way. There is stiff opposition by landowners who have been demanding larger sums of compensation. The primary reason for this demand is that the land below towers and under the corridor invariably diminishes in value.
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By Simar Singh Gujarat Chief Minister Anandiben Patel on Thursday laid the foundation for a new 800 MW unit of the state-owned Wanakbori thermal power plant in district Kheda. This will be the eighth and largest unit of the power station and will be set up by BHEL, drawing an investment of Rs 4,465 crore. Promising that the project would be completed by 2018, the chief minister accused the erstwhile UPA regime at the centre of setting back the project by six years by not issuing the necessary clearances required for its kick off. “We had sent an application to Government of India in 2009 for this project. Had timely environmental clearance been given, we would have been commissioning the unit today,” she said. The project promises to have lower emissions and coal consumption, as well as the bringing down of the per unit price of power produced at the Wanakbori plant. Speaking at the event, Gujarat Energy Minister Saurabh Patel said, “Today there are seven units of 210 MW each at this power plant. This unit will add another 800 megawatts and it will consume 25% less coal than the other seven units and will bring down the cost of power generation from Rs 3 per unit to Rs 2.40 per unit.” CM Patel further claimed that once completed the plant would add to Gujarat’s existing quota of surplus power, saying, “We currently have a power generation capacity of 24,000 megawatts and our peak demand is only 14,000 megawatts.” She also lashed at the opposition, saying that the BJP was bound to come back to power in the 2017 Gujarat state assembly elections. "The BJP-government is known for inaugurating all those projects for which we lay the foundation stone. I want to assure you that BJP will be in power in 2018 and I am confident that we will inaugurate this plant, for which we have laid foundation stone today,” Patel said.
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Prime Minister Narendra Modi is to tell states to raise electricity prices in return for access to a financial bailout package, a politically contentious move that risks a backlash from farmers and consumers long used to free or cheap power. Modi has made overhauling India's largely loss-making utilities, buckling under $66 billion of debts, a priority, convinced that if he can fix their finances he will recover his reputation as an economic reformer willing to take tough decisions. State-run electricity distributors are running out of cash and struggling to repay loans, squeezing banks' ability to spur credit growth and undermining Modi's campaign to attract more energy-hungry manufacturers to build new factories. Under a rescue package that could go to the cabinet for approval as early as this week, states will be told they must work with local regulators and utilities to raise tariffs that have been kept artificially low, a senior government source with direct knowledge of the plan told Reuters. In return for raising prices, the eight worst affected states will be allowed to absorb up to 75 per cent of the debt on the distributors' books depending on their fiscal position, the source said, requesting anonymity because the plan is not yet public. After cabinet approval, states will need to strike agreements with distributors and the power ministry, the government source said. The source added that it will not be easy and that each deal will need to be tailored individually, with varying tariff rises and performance targets. SENSITIVE SUBJECTIn India, the price of power is a sensitive subject and generally decided by individual state regulators. New Delhi's past attempts at instigating reform, including a 2012 rescue plan under Modi's predecessor, have largely failed. Many Indians view free or cheap power as a right. Politicians appeal to key groups of voters like farmers or the poor by keeping prices low and ignoring theft, prompting scepticism about whether states will agree to any package that forces tariff hikes. "There are two things that states completely avoid: raising tariffs for farmers and privatisation. These are hugely political," said Debasish Mishra, a power expert at Deloitte. "The political parties know what sells and what will keep them in power." Recent attempts at raising tariffs have proven politically difficult. Rajasthan state, whose utilities owe $9 billion, this year postponed an attempt to hike prices after huge opposition from its powerful farming community. But Modi successfully overhauled the power sector as chief minister in Gujarat in the mid-2000s. He saw off opposition to metering farmers and clamping down on consumer theft, and the state now enjoys reliable power supplies that the majority pay for, with low levels of theft. By linking price rises to reduced debt, the government hopes to give utilities the financial space to purchase more power and end blackouts, and to avoid future losses by ensuring they sell electricity at or above cost. Deloitte's Mishra said the government was likely to have more success in states ruled by Modi's Bharatiya Janata Party. S.K. Agarwal, finance director at Uttar Pradesh Power Corporation, serving a largely rural state ruled by a regional party, said he was still awaiting details of the plan, but since only the local government could decide tariffs it would object to any proposal imposed by New Delhi. He has previously said the utility had no plans to raise prices.(Reuters)
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Sterling and Wilson, Global Solar firm, to construct 300 MW Solar Photo-voltaic Projects in Egypt under its Feed-in-Tariff Programme for Renewable Energy initiated by Ministry of Electricity & Renewable Energy. Sterling and Wilson has recently opened its international office at Cairo, capital of Egypt to capitalize on the current opportunities offered by this Program and provide its customized & cost effective Solar EPC Solutions.Bikesh Ogra, President, Electrical & Solar Business of Sterling and Wilson, said, "We at Sterling and Wilson are committed to offering our customized Solar EPC Solutions to internationally renowned Solar Project Developers & IPPs including local Clients. It gives us immense pleasure to be able to execute solar projects across the globe within tight timeframes and costs which are key indicators of our project execution capabilities. We are confident of reaching our target in Egypt and are delighted that we are engaged with Qualified Companies, many of with whom we are already working in South Africa, Jordan, UAE, India, South East Asia, & Latin America"Sterling and Wilson will commission a single 50 MW Solar Photovoltaic power plant in less than 10 months. In completing Projects of targeted capacity, for most of which, construction will run simultaneously, it would like to utilize its ability of localization and an experience gathered in International arena. It believes that Egypt has huge resources and enough Project execution capabilities, to support the timely commissioning of these Solar Power Plants. It also aims to generate a number of employment opportunities locally, involving local talent in Engineering & Project management available in Egypt. It has already engaged Mr. Diaa Eldin Salah Mostafa a Veteran in the Power Generation Industry, as its Country Manager for Egypt. Mr Diaa brings with him rich experience of more than 20 years in Egypt.(BW Online Bureau)
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Union Cabinet is likely to consider this week a proposal to recast Rs 4.3 lakh crore loans of nine state power distribution companies with a view to bring down their liabilities. Sources said the debt restructuring proposal once approved would help the distribution companies in these states to access cheaper loans at an interest rate of around 9 per cent, compared to around 14 per cent that they are presently paying. The total loans to the discoms in the nine states -- Uttar Pradesh, Tamil Nadu, Telangana, Rajasthan, Madhya Pradesh and Jharkhand -- add up to Rs 4.3 lakh crore, sources said. The Cabinet, at its meeting on Wednesday, would consider the Finance Ministry's proposal to recast the debt of nine state power discoms so that the companies can repay their debt easily, they added. On account of subsidised tariffs, the state electricity discoms are facing cash crunch and are incurring annual losses of about Rs 60,000 crore. The debt burden has been one of the reasons for state power utilities not going in for new projects to raise electricity generation capacity. The debt liability has also forced them to not buy any additional power from new project, thereby creating peak hour deficit. The NDA government recognises power availability as key to pushing GDP growth rate to 8 per cent. Meetings at the level of the Prime Minister's Office have been held to clear roadblocks to stalled projects in the sector and high debt of state utilities has been identified as the prime reason for the current state of the sector. Sources said after the debt recast, the interest liability of power distribution companies in the nine states will come down besides extension of their loan tenure. According to data by the Central Electricity Authority (CEA), country's peak power deficit -- shortage in electricity supply when demand is at its highest -- was 3.2 per cent in March, 2015. The Ministry of Power has set a target of generating close to 1,100 billion units of electricity during the current financial year. Power generation during 2014-15 was 1,048.403 billion units. (PTI)
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The Asian Development Bank (ADB) is to help finance a project to increase transmission capacity of an India-Bangladesh power link to allow Bangladesh to better meet sharply rising power demand. ADB’s $120 million loan to Bangladesh will double the capacity of the existing interconnector which links the power grid of western Bangladesh at Bheramara and the grid of eastern India at Bharampur. The two networks were first interconnected in 2013, under a previous project financed by ADB. New transmission capacity will rise from 500 megawatts (MW) to 1,000 MW, ADB said. “There are power surpluses and shortfalls across the region and this project assistance will help these two countries move forward to better utilise their energy generation capacities and to support the broader goal of South Asian regional energy cooperation,” said Anthony Jude, director, energy division, in ADB’s South Asia Department. Bangladesh’s fast-growing economy has soaring energy needs and domestic natural gas supplies cannot keep up with demand, resulting in an increasing dependence on oil and diesel-based plants. To meet its goal of providing electricity for all by 2021, the government is working to increase generating capacity and to source additional supply. The initial linking of the two national grids helped India deliver over 2,000 gigawatt hours of electricity across the border in 2014. Along with ADB’s loan assistance, the government of Bangladesh will provide financing of $63.2 million. The project is expected to be completed in June 2018. (Reuters)
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The financials look sound, and NTPC is optimistic about its expansion plansBy being a consistent performer, NTPC has moved up two notches on the BW 500 list, occupying sixth place this year. NTPC recorded approximately a nine per cent increase in income, and around 10 per cent growth in assets. Roughly the same trend was witnessed last year.The past year has been a particularly testing one for NTPC, with coal stocks at rock-bottom resulting in a precarious situation at various plants. NTPC’s thermal plants are designed for a specific quality of (domestic) coal. Considering the huge shortfall, some 30 to 40 per cent imported coal was blended into the domestic supply — something unprecedented for NTPC.“Today we have an average supply at our plants of 16 days, which is a very comfortable position compared to last year,” says A.K. Jha, chairman and managing director of NTPC.Over the past year, the Maharatna company diversified into hydropower and formed joint ventures with state-run entities. As a result, its asset worth jumped to Rs 197,084 crore from Rs 179,554 crore in the previous year. Its profit after tax, however, took a dip compared to the previous year’s figures — from Rs 10,974 crore to Rs 10,290 crore this fiscal, but this is more due to the fact that it received accumulated dues from DESU last year. With its financials in great shape, NTPC has huge capacity expansion plans, and Jha says they are important if India is to grow at eight per cent.With many discoms in bad shape, the demand for electricity is not great. Many private companies are not able to sell electricity as a result. NTPC, has a power generation capacity of 23,004 MW under various phases of completion. Last year, it added about 2,000 MW; this year the target is 2,403 MW, of which 1,115 MW has been achieved.Regarding NTPC’s diversification into hydropower last year, the first project was the 800-MW Koaldam power plant in Himachal Pradesh. Two units were commissioned last year; two more will be commissioned this year. Making rapid strides, NTPC recently completed the bidding process for its joint-venture plant in Bangladesh. It is also working on a project with the Sri Lanka electricity board.NTPC has also made acquisitions by way of a joint venture between the state of Jharkhand and NTPC – Patratu Thermal Power Station. It will have a capacity of 4,000 MW there. Also the takeover of the Damodar Valley Corporation’s Raghunathpur plant in West Bengal may materialise by the year-end.NTPC is focused on renewables in a big way. Jha says: “Till last year, we had 110 MW of solar power in operation. We have a target of 10,000 MW to be added in the next five years.”Jha says that instead of a big push, or a quantum leap, it’s the incremental effect over the years that works the best for the organisation, and NTPC is well placed to achieve its target of 128,000 MW of power by 2032. NTPC has had its share of challenges, and coal mining has been one. NTPC was allotted eight coal mines. But the mining process could not be started, mainly because except for one mine, all the others were de-allocated, re-allocated, again de-allocated (by the Supreme Court), and then freshly allocated now.NTPC has now diversified along value chain – it is engaged in trading, coal mining, consultancy, equipment manufacturing and distribution (on its own and through joint ventures). With the guiding principle of 24X7 power to all by 2019, NTPC is moving ahead ambitiously. “For power to all by 2019, there has to be sufficient capacity in the system,” says Jha. “NTPC is working towards that. This year we are adding 4,000 to 5,000 MW. Next year onwards, we will be adding 6,000 MW every year.” — Suman K.Jha(This story was published in BW | Businessworld Issue Dated 19-10-2015)
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Hindustan Power today said it will issue bonds worth Rs 380 crore on private placement basis to Yes Bank for three of its projects in Gujarat."The clean energy arm of Hindustan Power achieved the distinction of entering into the credit enhanced bond market with the issue fully underwritten by YES Bank Ltd," the company said.Under the partial credit guarantee scheme of IIFCL, the infrastructure financing institution will provide a 'first loss' partial credit guarantee to the bondholders and has received an irrevocable back-stop guarantee with the Asian Development Bank (ADB).Placement of these bonds besides opening a new market for financing infrastructure projects, would also significantly bring down the cost of capital for the projects."With the announcement of this transaction we will be refinancing the existing debt in 3 solar SPV's of ours through the placement of Rs 380 crore worth of bonds with Yes Bank at an attractive coupon of 10.05 per cent for a tenure of 10 years," Hindustan Power Chairman Ratul Puri told reporters.This, he added, is a significant milestone for the country in its push towards achieving 100 GW of solar by 2022 and inching closer to the government's agenda of 24X7 power to all.The power company will issue secured, rated, listed, partially guaranteed, debentures worth Rs 380 crore on a private placement basis to YES Bank LtdBSE -0.16 % for three of its "AA+ SO rated" projects in Gujarat.Most of the infra projects are rated BBB or A while investors seek higher ratings.The bonds will be listed on NSE.Currently, banks provide most of the funding for infrastructure projects in India, whereas worldwide Debt Capital Markets are the major source of such financing.(PTI)
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