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Showing posts with label power purchase agreements. Show all posts
Showing posts with label power purchase agreements. Show all posts

Thursday, 8 October 2015

05:22

Indian Railway approach CERC for Open Access in Inter-State Transmission and Connectivity

Indian Railway approach CERC for Open Access in Inter-State Transmission and Connectivity

IR Electrification Map 2014New Delhi: The Indian Railways, which will soon enter into a long-term power purchase agreement for 500 Mw power from Dabhol project, has approached the Central Electricity Regulatory Commission (CERC) with a plea to grant connectivity, long- and medium-term open access in inter-state transmission. The petition comes close on the heels of the board of Ratnagiri Gas & Power (RGPPL)’s approval last week to split the project into two entities — one for gas-based electricity and the other for liquefied natural gas re-gasification terminal. The company expects to restart the power generation from 1st November, 2015. Indian Railways’ plea is also crucial as it is a deemed licencee for transmission and distribution of electricity and Section 14 of the Electricity Act, 2003 provides that the appropriate government will be a deemed licencee to transmit or distribute electricity or undertake trading in electricity. The same provision envisages that deemed licencees need not take licence for the purpose.

Further, Indian Railways has submitted it was comfortable being treated as part of the state entity. It had filed its petition after the power purchase agreement was entered between the Central Railway and Gujarat Urja Vikas Nigam for supply of 100 Mw of electricity at Gujarat Energy Transmission Corporation (GETCO) periphery (inter-connection point between GETCO, state transmission utility (STU) and central transmission utility system of western region. According to the arrangement, the transmission system of PowerGrid Corporation of India will be available from such point to the periphery of the STU of the state where the electricity purchased is to be conveyed to Indian Railways’ network.
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Saturday, 18 July 2015

07:25

Indian Railways calls for Bids from Power producers to supply 1010 MW of Electricity over 3 years

17/07/2015

Indian Railways calls for Bids from Power producers to supply 1010 MW of Electricity over 3 years

Trying to take advantage of its position as the largest consumer of power in the country, Indian Railways has stepped up efforts to reduce electricity costs

New Delhi: At a time when cash-strapped state electricity boards (SEBs) are averse to buying power, Indian Railways has emerged as a potential saviour for idling power projects.

Railways, the state-owned transporter, has stepped up its efforts to reduce electricity costs and has called for bids from power producers to supply 1,010 MW of electricity over three years.

Indian Railways has floated the tender through Railway Energy Management Co. Ltd for sourcing electricity in the eastern region (350 MW), west (440 MW) and north (220 MW). This is in addition to 500 MW it plans to buy from the Ratnagiri Gas and Power Pvt. Ltd’s Dabhol plant in Maharashtra.

“The electricity is to be supplied for three years from March 2017 to March 2020,” said a person aware of the development. The person didn’t want to be named.

The railways is trying to take advantage of its position as the largest consumer of power in the country to bring down its electricity costs. The national transporter needs about 12 billion units of electricity a year, with consumption growing at an average 5% per year. Its power bill is estimated at Rs.11,000 crore for the current fiscal year.

By calling for competitive bids, the railways expects to benefit from lower tariffs. The transporter is seeking to reduce its electricity cost to less thanRs.5 per unit from the present average of around Rs.7 per unit.

Queries emailed to an Indian Railways spokesperson remained unanswered till press time.

Cash-strapped SEBs have been unwilling to procure electricity, given the low tariffs they earn for power supply, slow progress in reducing losses and higher power purchase costs. SEBs are laden with debt of Rs.3.04 trillion and accumulated losses of Rs.2.52 trillion.

“Progress w.r.t. (with reference to) tie-up of new long term PPAs (power purchase agreements) by state owned distribution companies continues to remain slow with sizeable generation capacity having no long-term PPAs; timelines for implementation of tariff compensation for the affected thermal IPPs (independent power producers) remain uncertain,” rating agency ICRA Ltd wrote in a 7 July report.

“In Icra’s view, the financial position of state-owned distribution utilities in many states continues to remain weak, with large subsidy dependence, and limited progress in loss reduction against the regulatory targets in some states and high debt levels,” the report said.

Indian Railways plans to buy electricity from the Dabhol plant, offering a lifeline to the 1,967 megawatt (MW) power project now owned by Ratnagiri Gas and Power Pvt. Ltd, RailNews reported in the recent past.

The national transporter plans to reduce electricity bills by nearly one-third by seeking competitive bids from power producers, sourcing from electricity exchanges and reaching bilateral arrangements. This plan was articulated in this year’s railway budget.

“Although a bulk consumer, railways pays extremely high charges for traction power,” railway minister Suresh Prabhu said in his budget speech. “It is proposed to procure power through the bidding process at economical tariff from generating companies, power exchanges and bilateral arrangements. This initiative is likely to result in substantial savings of at least Rs.3,000 crore in next few years.”
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