NTPC to list 3 subsidiaries as part of Rs 15,000-crore asset monetisation

State-owned thermal power behemoth NTPC would list on exchanges its three subsidiary companies, in order to meet the government stipulated target of Rs 15,000 crore worth of asset monetisation. The three companies are NTPC Vidyut Vyapar Nigam (NVVN), North Eastern Electric Power Corporation (NEEPCO), and one-year-old NTPC-Renewable Energy (NREL). 

NTPC would also exit its joint venture with steel major SAIL -- NTPC-SAIL Power Company -- as part of the monetisation plan. Senior NTPC executives said NREL would be listed before October 2022. NTPC incorporated the wholly-owned subsidiary for its renewable energy projects in October 2020.

Gurdeep Singh, chairman and managing director of NTPC, at a public event in June this year, had announced that NREL would be listed soon. “We should not focus on one way of raising funds. We want to soon go public for raising funds,” he said. The company looks to add 7-8 Gw renewable energy every year.

Apart from solar and wind power projects, NTPC is looking at investing in green hydrogen and green methanol -- cleaner fuels that are manufactured at units powered by renewable energy. 

Sources said the company would start a pilot of producing green hydrogen at its Vindhaychal thermal power unit in Madhya Pradesh.

NTPC builds renewable projects under two heads – the EPC (engineering, procurement, and construction) model, under which it participates in tenders floated by the Centre and states and constructs on its own. It has constructed 1.2 Gw of solar and wind projects. The other is the developer mode through which it awards renewable projects to private companies and procures power to sell to states. Under the developer mode, 4 Gw projects are operational and tenders for close to 3 Gw will be finalised soon.

The other subsidiary is NVVN -- established as the power trading arm of the company. Over the years, it has morphed into the environment arm for NTPC with projects in fly ash trading and usage, renewable energy, electric and hydrogen mobility, and waste to energy. NVVN is also planning projects procuring green, agro-based fuels for blending at thermal units. Recently, NVVN floated a tender to procure 20 million tonne of bio-pellets made from farm stubble.

Senior executives said NVVN is being redesigned to become the “energy transition” company for NTPC and take up projects that can add to NTPC’s ESG (environment, social and governance) targets. “Upon listing, NVVN would be a standalone example of technology development for energy transition in the country,” said an executive.

NVVN traded over 18 billion units (BUs) of power in 2020-21, which was the highest volume since its inception, said the annual report of NTPC. It also started plying 40 e-buses in Port Blair and won tender for supplying and operating 90 e-buses for Bengaluru Metropolitan Transport Corporation (BMTC). It has installed 1,000 EV charging stations in eight cities, so far.

NVVN is also at various stages of implementation of ground-mounted/roof-top solar projects, along with charging infrastructure development at various airports and public buildings, said the annual report. It paid a dividend of Rs 30 crore during 2020-21.

NTPC acquired a 100 per cent stake in NEEPCO in March last year, earlier owned by the Union government. NEEPCO operates seven hydro, three thermal and one solar power stations with a combined installed capacity of 2,057 Mw. Last financial year, NEEPCO commissioned its largest 600 Mw hydro project at Kameng, Arunachal Pradesh.

NTPC-SAIL Power Company is a 50:50 joint venture between the two CPSUs. It owns and operates captive power plants of SAIL in Durgapur, Rourkela and Bhilai, and has a total installed capacity of 814 Mw.

The NITI Aayog in its recently published National Monetisation Pipeline (NMP) has identified 6 Gw worth of power generation assets for monetisation over FY2022-25. This comprised 3.5 Gw hydel assets and about 2.5 Gw renewable (solar and wind energy) assets. The Centre expects to fetch around Rs 39,832 crore from these power generation assets.

“Together, 6 Gw asset base considered for monetisation constitutes about 6 per cent of total generation capacity under central PSUs. Key entities whose assets have been considered are NHPC, NTPC & SJVNL, which own the bulk of the hydel assets, and NTPC (under Ministry of Power) and NLC (under Ministry of Coal) which own renewable assets,” NITI said in the NMP.

Monetisation plan

NTPC to list three subsidiaries: 

• § NREL – Renewable energy arm incorporated last year, to help execute 60 Gw RE by 2032 plan by NTPC
• § NVVN – Power trading arm now recasting into energy transition/environment company
• § NEEPCO - Acquired from the Centre last year, helped NTPC increase its hydro footprint and presence in the Northeast

To exit from the 50:50 joint venture in NTPC-SAIL Power Company