| IPP Policy - Need For Review of IPPs and Formulation of a Policy | | | | 
| - A more detailed exercise about the power augmentation programme has to be carried on to ensure that the economic development does not suffer not only from inadequacy of power but also from lack of confidence among the entrepreneurs that shortage situation would recur. At the same time, it is also necessary to avoid a situation where capacity added as far in excess of the requirement. This is a delicate exercise and power requirement has to be reviewed each year and revised to the extent needed depending on the field situation.
- The Committee also examined various scenarios assuming an average of 6% and 7% growth rate in consumption across the board. The Committee has also taken note of the need for encouraging the Cogeneration including Bagasse based power plants and generation from renewable energy sources along with IPPs. If a higher growth rate is considered, the capacity to be contracted will be more.
- There are 14 IPPs with proposed capacity addition of 2450 MW for which PPAs have signed during the past under Bid/MOU/GO routes including barge mounted projects. Further there are 12 more IPPs with capacity addition of 6059 MW for which PPAs have not been signed. In addition to these projects, tha capacity addition of 1887 MW is expected from the existing sources. Further, the proposals for about 1300 MW from other sources are also under consideration.
- The available capacity as on 31-03-2000 (including 200 MWs, which are seasonal in nature) was 5417 MWs taking into account the contribution from Central Generating Stations. The requirement could vary from 3101 MW to 5257 MW over ten year period, as indicated earlier.
- The Committee after considering various scenarios, projections, status of various IPPs and policy options including the privatization of distribution on the anvil, has established the annual incremental capacity requirement, on realistic assumptions and to be consistent with the financial capabilities of the power utilities, as follows:
Year ended 31st March | | 2001 | 413 | | 2002 | 433 | | 2003 | 172 | | 2004 | 303 | | 2005 | 178 | | 2006 | 180 | | 2007 | 189 | | 2008 | 481 | | 2009 | 219 | | 2010 | 932 | | Total MW 3500 | - The Committee is of the view that the capacity addition ought to be between 3500-4000 MWs considering that some of the projects may not materialize and with due allowance for slippages. This would imply that a capacity of 650 to 1650 MWs has to be added during the course of next ten years, in addition to the additional capacities are added and consumption does not increase commensurately, particularly by those consumers who can pay at levels, which enables KPTCL and DISCOS to make a profit, the financial health of KPTCL and its successors would worsen. But it is desirable in the overall interest of the State, to avoid shortage and at the same time ensure that excess capacity is not added through periodical review.
- Considering the fact, that the two strategies followed earlier, viz MOU route and bid route have not yielded the desired results, it is necessary to evolve a policy which enables capacity addition in the most economical and transparent manner and without delay. The additional capacities have to come through IPPs or through CGS or KPCL. The criterion should of course be that the cost of supply is the lowest. This would call for evolving a policy for selection of the prima-facie competetive projects and thereafter compare the rates and choose those projects, which are most advantageous techno-economically.
- Committee had also taken note of the Multi-partite Agreement entered into between GoK, KPTCL, KPCL and IFDC, Mumbai in respect of funding RTPS 7th unit of KPCL, on 15-10-2000, on the basis of firm and time-bound commitments on the part of GoK, KPTCL and KPCL, and to reform and restructure the power sector.
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