GE Power India sees coal-based power becoming a niche and complex space as the fuel transforms from being a base load to having about 52 per cent share in the overall electricity market by 2030. It also estimated the size of the flue gas desulphurisation (FGD) business at 143 Gw in three to five years.
This statement comes even as the company’s stock has taken a beating after its parent announced on September 21 that it would exit new coal business globally. The stock has fallen over 50 per cent to Rs 201.8 a share on Monday from Rs 444.75 on September 21.
Prashant Jain, managing director, GE Power India, told Business Standard, “We have accelerated our market share from 3 per cent to 5 per cent in the last few years. We are looking at expanding this market to operations and maintenance.”
The market for efficiency and emission control is worth $900 million and is centred around parts, repairs, and services of boilers, turbines, generators. This would increase to $3-4 billion as the firm ventures into existing assets and renewable integration.
“We have a Rs 7,500-crore order backlog that we will do over the next two to three years. We have this time to prepare a strategy for renewable integration,” said Jain.
There are a lot of opportunities in the transformation of operation and maintenance strategy, Jain said, adding that some suppliers might not remain because of the stress in the space, so it would be a niche segment. “Thermal will be a niche play for managing and operating assets. It will be complex with operations and maintenance and that is where GE has technology and partnerships to enable this transition of renewable integration.”
In a statement to shareholders, GEPIL said while its promoter, General Electric, has announced its intention to exit from new coal power market globally, GEPIL continues to see a demand for FGD systems in India. The total FGD market, (including captive power plants) in India is 225 Gw, of which 82 Gw (Rs 33,000 crore) has been ordered by mostly central public sector utilities and a few state utilities. GEPIL has so far been awarded 10 FGD projects, amounting to 13 Gw (representing about 15 per cent market share), which are now in various stages of execution.
The rest that remains to be ordered in the next 3 to 5 years is estimated at 143 GW. Of this, GEPIL pursue opportunities independently for around 66 Gw (Rs 29,000 crore), consisting of potential IPP and captive power plant customers, on the basis of its existing technology licence agreement.
The remaining potential market of 77 Gw comprises of central and state government customers. An October 25 ICICI Securities report, however, noted that most of the orders from NTPC have been completed and 84 Gw of FGD orders have been finalised.
Some 145 Gw of orders are pending finalisation from state electricity boards and the private sector.