PTC bags maximum power supply orders to Uttarakhand and Kerala state utilities in short term power procurement auction

PTC India has bagged the largest number of power supply orders at competitive rates to Uttarakhand and Kerala state utilities at a recently concluded short term power procurement auction.





It offered 9 bids from different sources to Uttarakhand and three bids to Kerala over an electronic bidding and reverse auction conducted on a new portal.

The portal, christened Discovery of Efficient Electricity Price e-Bidding & e-Reverse Auction portal was launched in April for procurement of short term power by utilities. It is a single platform for all utilities willing to procure power on short-term open access contracts through electronic competitive bidding and reverse auction.

PTC was the sole successful bidder for Kerala. It will supply 100 MW -- the entire requisitioned quantum by Kerala State Electricity Board during peak hours and 50 MW during non-peak hours.

In Uttarakhand, PTC bagged the contract for more than half the quantum as awarded by Uttarakhand Power Corporation Ltd. It will supply during evening peak and an additional 150 MW round the clock.

"Consumers will benefit from competitively procured power supplied by PTC, especially during summer peak demand periods" said Deepak Amitabh- CMD, PTC India.


Experts Comment:

The introduction of providing online platform for short term will help to bring transparency. PTC has always been in top in short term power market in India. There will be not much difficulty to find buyers and sellers as it will bring at same platform. With such initiatives,the growth of short term will be more efficient in future.

2.61 lacs RECs traded in REC market at IEX on 27 April

A total of 2.61 lacs RECs were traded in the REC market trading session held at IEX on 27 April, 2016.

With April being the first month of FY 2016-17 annual compliance period, the market made a good start since same time last year only about 45,000 RECs were traded, IEX said in a statement.


Several Obligated Entities who purchased RECs in this trading session are essentially fulfilling their RPO compliance for FY 15-16.
The key details of this trading session:

Non-solar segment: Total buy bids were 2,38,485 and total sell bids were 89,80,430. 
All buy bids were cleared at floor price of Rs 1,500 per REC. 

Solar segment: Total buy bids were 22,958 and total sell bids were 23,48,055. 
All buy bids were cleared at floor price of Rs 3,500 per REC. 

Participants: 

A total of 1,420 participants traded at IEX with 904 participants in non-solar segment and 516 participants in the solar segment.

On an overall basis, a total of 3,151 participants are registered in the REC segment at IEX. Of this, 829 are Eligible Entities (RE Generators) 2,309 are Obligated Entities (DISCOMs, Open Access Consumers & Captive Generators) and 13 are registered as Voluntary Entities, IEX said in the statement.

NTPC recorded highest ever annual power generation of 241.98 billion units

State-run NTPC on Friday said it has recorded highest ever annual power generation of 241.98 billion units (excluding its joint ventures) last fiscal.

Besides, the company has exceeded its capacity addition target by adding 2,255 MW last fiscal, taking NTPC groups total installed capacity to 46,653 MW, as on March 31, 2016, the company said.

NTPC's solar stations generated 160.8 million units, its highest ever, at a CUF (capacity utilisation factor) of 16.64%, it said. During the period, the company's four coal power stations were amongst the top 5 in the country in terms of PLF (plant load factor). PLF is the proportion of installed capacity utilisation of the power plant.

The company also met its capex (capital expenditure) target of 25,000 crore during the year and achieved 100 per cent realisation of the dues. The coal mining activities will soon commence at its Pakri Barwadih Mine. It has reduced its coal import consumption by 42.19% during the year to 9.47 million tonnes from 16.38% last year, it said.

As a result of its efforts like rationalisation of coal linkages, reduction in imported coal consumption, enforcement of third-party sampling of coal and other measures in the second half of 2015-16 fiscal, it reduced energy charges of coal stations by nearly 20%. NTPC shall endeavor to bring down the energy charges further to help the discoms, it said.

With capacity addition of 9,550 MW during the current Five Year Plan (2012-17), NTPC is all geared up to achieve the target of 11,920 MW for the 12th Five Year Plan ending on March 31, 2017, it added. During 2015-16, it has commissioned Koldam unit 3 and 4 of 200 MW each in Himachal Pradesh, Bongaigaon unit-1 of 250 MW in Assam, Vindhyachal unit-13 of 500 MW in Madhya Pradesh, Nabinagar Unit 1 of 250 MW in Bihar, Kanti Unit-3 of 195 MW in Bihar, Mouda Unit-3 of 660 MW in Maharashtra.

Under the CSR activities, the company will continue to provide safe drinking water and focus on training and skill development of people in the vicinity of its projects and stations, it said.

Experts Comments:

With this achievement, in future this will surely help to reduce demand-supply gap in India.

Jindals may be set for a deal on Chhattisgarh power plant

Mumbai: Sajjan Jindal-led JSW Energy Ltd is in advanced talks to buy a power plant owned by Jindal Steel and Power Ltd, controlled by his younger brother Naveen, said two people directly involved in the discussions.

“The deal is valued at more than Rs.5,000 crore and is to be announced before the 31st of this month,” said one of the two people cited above.

The sale of the 1,000 megawatt (MW) power plant in Chhattisgarh will help the struggling Jindal Steel and Power to meet interest payment obligations and pare overall debt. Jindal Steel, which has reported loss for five quarters in a row, had consolidated debt of over Rs.42,534 crore as of 30 September.

The Chhattisgarh plant is operated by Jindal Power Ltd, a unit of Jindal Steel.

“The debt on Jindal Power’s books is much less than what all of its assets together value. A deal for the power assets will help the parent company access more cash to ease out debt woes on the steel business,” said a senior steel analyst who declined to be identified.

Steel makers in India have been hurt by a steep fall in realizations because of the cheap imports from China, Japan, South Korea and Russia.

Both people cited above said that the deal was discussed at the JSW Energy board meeting on Monday.

A spokesperson for JSW Energy, which has been on the lookout for distressed power assets, denied that it is in talks to buy any particular asset.

“JSW Energy Ltd continues to evaluate various growth opportunities. However, the company is not in specific discussions for any particular project,” said the spokesperson for JSW Energy.

Jindal Steel & Power declined to comment on the sale of the Chhattisgarh plant but said the company is evaluating various options to strengthen its balance sheet.

On Monday, Reuters cited Jindal Steel chief executive officer Ravi Uppal as saying “that a deal is being negotiated.”

Reuters said the deal may be announced as early as this week.

On 18 March, The Economic Times first reported the talks between JSW Energy and Jindal Steel for the 1,000 MW power asset.

Ratings agency Crisil Ltd has rated Jindal Steel and Power’s debt as default, citing delayed payment of interest on term loans due to weakened liquidity. On 11 March, Credit Analysis and Research Ltd (CARE) downgraded JSPL’s debt instruments to a default rating.

In an interview on 10 March, Uppal said the company will try to sell stakes in certain units of its steel business, set up joint ventures with companies in Asia and Europe and seek a buyer for its power assets in India, in an effort to pare debt.

Uppal also confirmed there were delays in meeting interest payments due to the stress in its steel business.

The second of the two unidentified people said that the Chhattisgarh plant is the only power asset the company is looking to sell immediately. “No other power asset from Jindal Power is on sale,” said the person.

Jindal Power has a combined capacity of 3,400 MW.

For JSW Energy, the deal will help increase its capacity from the current 4,531 MW to 5,531 MW.

JSW Energy has been in discussions with Jaiprakash Power Ventures Ltd for its 500MW Bina thermal power plant in Madhya Pradesh. JSW Energy is also in talks with Monnet Ispat and Power Ltd to acquire its unit Monnet Power Co. Ltd, which is developing two coal-fired thermal power plants with a total capacity of 1,050 MW in Odisha.

The two people cited above said that deal discussions for both these assets are still under consideration.

“We have seen stressed sales in the power sector in the past and we will see some more,” said Harish H.V., a partner at Grant Thornton India Llp, a financial advisory.

“The valuation will depend on how much capacity has long term agreements in place and what is the price of that. It will also depend on how much can the debt related to the particular asset be restructured if the asset is a stressed one,” he said.

Experts Comment:

Sale of the 1,000 MW power plant to JSW Energy will help Jindal Steel and Power pare overall debt. The acquisition are becoming common in Indian power industries. It is the best way to increase the installed capacity of the firm.

Nine-hour power supply to farm sector under study

The Andhra Pradesh government is considering providing nine-hour power supply to the farm sector, said Minister K. Atchannaidu in the Legislative Council here on Monday.

Responding to various queries related to free power to farmers during question hour, the Minister said that the government was bearing Rs. 3,186 crore on subsidy towards free power. He said that instead of three time slots of power supply to pump sets from 4 a.m to 11 a.m, 11 a.m to 6 p.m., and 9 p.m. to 4 a.m, farmers wanted it to be given in two slots. The proposal is under examination, he said.

‘Five star’ pump sets

Another initiative would be to install quality ‘five star’ pump sets which cost double than that of conventional pump sets but they would help in saving 30 per cent of power. The Discoms were supplying quality pump sets to farmers free of cost and the amount could be recovered in three years through the power saved. Another 1.2 lakh new pump sets would be sanctioned under NTR Jalasiri and applications had been invited.

The Central government, impressed with the initiative, offered to give another one lakh five star pump sets to the State, he said. Demand for solar pump sets too was increasing with 4.5 lakh people applying so far and 10,000 solar pump sets would be given this year. He positively responded to suggestion to give solar pump sets on subsidy in Anantapur district and extend the high voltage distribution system.

Steps were also taken to ensure quality power supply and prevent breakdown of transformers due to overload, he said. In case of breakdown of transformers, standing instructions were given to the department to replace them in 24 hours.

Expert's Comment:

Providing free power to the consumers will always burden the Discoms. However with initiatives like providing efficient pumps can help the utilities to save their money. One of the limitation is that the payback will take time.