OPGC pulled up for excess coal consumption

The Comptroller and Auditor General (CAG) of India has pulled up Orissa Power Generation Corporation (OPGC) for its failure to analyze the coal received from Mahanadi Coalfields Ltd (MCL) which resulted in consumption of excess coal valued at Rs 72.02 crore during 2005-06 to 2009-10.

It may be noted that out of the requirement of coal at 23.21 lakh tonnes, the actual consumption by the OPGC units was 25.53 lakh tonnes in 2009-10. Similarly, the coal consumption in 2008-09 and 2007-08 stood at 28.17 lakh tonnes and 26.67 lakh tonnes respectively as against the requirement of 25.01 lakh tonnes and 23.88 lakh tonnes.

While the OPGC management claimed that the consumption of coal was more due to higher ash content of coal ranging from 37-41 per cent, the CAG report has stated that the contention is not based on facts because the plant design contemplated use of coal with 42 per cent ash content.

The company received 'F' grade of coal from MCL which should have minimum Gross Calorific Value (GCV) of 3865 Kcal/kg. As per power purchase agreement with Grid Corporation of Orissa, the GCV of coal was to be 3400 Kcal/kg. The actual GCV of coal fed to the boiler of the power plant, however, ranged from 2304 Kcal/kg to 3043 Kcal/kg. The CAG report says that the company did not analyze the reasons for such variation or took corrective action.

The report further says that coal quality improvement is an area which requires to be emphasized for optimum utilization of coal. The Central Electricity Authority (CEA) had prescribed options like coal beneficiation and blending of high ash coal with low ash imported coal for higher operational performance and lower maintenance cost.

Even the OPGC board of directors in August 2008, had decided to import 50,000 tonnes of coal to blend with coal received from MCL as five per cent imported coal.

The company, however, did not make any plan for importing coal.

Besides, OPGC fell short of its power generation targets in 2008-09 and 2009-10, with the combined shortfall in these two years being 231 million units (MU). As against the target of 3127 MU in 2009-10, the actual generation was 2961 MU. Similarly, OPGC's power output in 2008-09 stood at 3191 MU compared to the targeted 3256 MU.

The CAG report has attributed the generation loss to bad workmanship which was due to the failure of the management to monitor the performance of the contractors which needed to be addressed to avoid shortfall in generation.