Revenue from acquired stressed assets to finance new projects, says NLC India CMD

NLC has also ventured into power trading now, owing to the higher power surrender by user states and discoms

NLC India Ltd, formerly Neyveli Lignite Corporation Ltd, said that the company is following a business model where it can finance new project construction activities through revenue that would be coming from acquisition of operating and shortly operable stressed power assets.

The company has recently announced a joint-venture (JV) with Damodar Valley Corporation (DVC) for acquisition of the latter's 1200 Mw (2X600 Mw) Raghunathpur Thermal Power Project, subject to regulatory approval. The company will hold 74 per cent of the equity capital in the JV firm.

"We are following a business model where we can leverage our reserves and finance our new project construction activities through the revenue that would be coming from acquisition of operating and shortly operable stressed power assets," said NLC India Chairman and Managing Director S K Acharya, in his address to employees on Independence Day.

He said that NLC has established a new identity with business diversification and geographical expansion. With Pan Indian presence and its business activities ranging from mining of lignite and coal, lignite and coal-based power generation, and power generation from solar and wind, NLC is now NLC India Ltd.

It envisions becoming a 19,831 Mw, fuel sufficient power-generating company by 2025. It has already doubled its mining capacity by adding 31.5 million tonnes per annum of coal from Odisha and Jharkand mine sources.

He added that approval has been provided by the government for the construction of a 1980 Mw coal-based power station in Kanpur district, Uttar Pradesh. Wind power has reached 30 Mw out of planned capacity of 51 Mw. A 10 Mw solar power plant was commissioned at Neyveli. The company is in the process of adding 3990 Mw in the states of Tamil Nadu, Karnataka, Odisha, Rajasthan, Uttar Pradesh and Andaman Islands, he said.

It has also ventured into power trading now, owing to the higher power surrender by user states and discoms.

The new business challenge of facing huge power surrender made it mandatory for the company to manage its cost wisely and remain competitive in merit order power-generation market. It has also prompted the company to have a relook at its expansion activity to ensure that the cost of generation from its new facilities should have to be economical and competitive, he added.

The company has launched a diploma course in mining engineering in association with Annamalai University. The course will start this year to train the local youth, including youth from project-affected families, in mining skills.