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| Wind power operators in MP wait for tariff guidelines |
| Shashikant Trivedi / New Delhi/ Bhopal Oct 30, 2009, 00:10 IST |
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Wind power operators, who have queued up in Madhya Pradesh for a combined capacity of 900 Mw, are eagerly waiting for regulators to define tariffs for the sector.
The Central Electricity Regulatory Commission (CERC) has already issued guidelines in this regard. Hydropower major National Hydroelectric Power Corporation’s subsidiary Narmada Hydroelectric Development Corporation (NHDC) is also setting up a 100-Mw plant in Betul district.
However, Madhya Pradesh does not have potential in comparison with the southern states as output may remain low owing to low wind velocity.
The PLF (plant load factor) or CUF (capacity utilisation factor) in the state is not more than 20 per cent, thus, making the projects economically non-viable. Further, the tariff is in decreasing order from Rs 4.03 per unit (first five years) to Rs 3.36 per unit for the following years.
“A number of companies have proposed plants at Ratlam, Betul, Jawra and Dewas but it seems the private players are waiting for higher power tariff, which is Rs 3.36 per unit at present,” a government source told Business Standard, adding that “the state regulator is learnt to have working on tariff.”
The state and private players are expecting to promote fresh investment in the sector so that power supply from renewable source could meet the National Action Plan targets.
At present, the state has few companies like Enercon and MP Windform in the wind energy sector.
The total wind power capacity of the state is 158 Mw. Companies that have proposed establishments in the state are Southern Windform, Marut Shakti, Kalani Group of Indore, Suzlon, NHDC and NEPC for a combined capacity of 906 Mw against the total potential of 1200 Mw.
The CERC last month notified the tariff regulations for power generated from renewable energy sources. The regulations have special importance in view of the National Action Plan on climate change.
“We are expecting the regulator will put the tariff slightly higher in the range of Rs 4.25 to Rs 4.50 per unit to make the projects viable and attract more investment. We have already planned a project and we will install modern machines that will improve the output,” a potential investor, who has planned a project in Betul, said.
States like Tamil Nadu, Rajasthan and Maharashtra have tariff of Rs 3.35 per unit to Rs 4.38 per unit with higher CUF.
“A project in Tamil Nadu is viable as CUF touches 28 per cent, so lower tariff does not affect the investor. While in Madhya Pradesh the CUF is hardly 18 per cent, thus the investment does not fetch results. Moreover, the government charges a fee of Rs 50,000 per Mw for unknown reasons. Interestingly, clearances are to be obtained from the state power department arm MP Urja Vikas Nigam unlike other states where state boards handle the matter. Besides, sites are bereft of basic infrastructure, enough to keep investors away,” said another investor.
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