Gujarat Minister Hints At Redefinition Of Captive Power Plants

Gujarat minister of state for power Vipul Choudhary yesterday hinted at a redefinition of captive power plants which may or may not involve sister concerns of an industry or chambers of commerce.

Inaugurating a seminar on the power scenario in Gujarat, organised by the Gujarat Power Corporation Ltd at the instance of Chief Minister (CM) Shankersinh Vaghela, Choudhary emphasised that the CM had accorded the highest priority to the adequate availability of both power and potable water.

The states insecurities on the power front, which has not kept pace with its industrialisation, were underlined by a number of speakers at the inaugural function, including chief secretary L N S Mukundan and additional chief finance secretary Rama Subbarao.

 

Subbarao categorically said that the states power scenario depended entirely on decisions which the government may or may not take in the next twelve months, especially in the area of tariff. The Rs 4,500 crore of tariff claims was as large as the state plan, he said.

Subbarao went to the extent of warning power purchase agreement partners of risk investment, considering the financial health of the state electricity board as well as the political one of the government.

On the question of cross-subsidisation, he queried: to what extent was the industrys complaint of being overburdened justified?

He felt there was clearly a need for a regulatory tariff agency and that a blind insistence on government guarantees was also futile.

Chief secretary Mukundan rued the fact that Gujarat needed to more than double its present installed electricity capacity of 6,500 megawatts, to 15,000 mw within the next three years.

He said that this was in the face of a number of imponderables like the environment-friendly liquid natural gas involving a long gestation period added to the fact that 12 to 13 million tonnes of it was tied up in the crucial petrochemical industry of the state.

He observed that although the power policy of 1995 had invited the participation of the private sector, it was high time that the rationalisation of power tariffs was discussed threadbare.

Gujarat Electricity Board chairman S J Coelho, admitting that the demand for power in the state had already gone up by 35 per cent without any additional capacity, was quick to point out that there would be 2000 mw more in the Gujarat system by next summer, the bulk of which will come from the new joint sector Gujarat Torrent Energy Corporations 650 mw plant.

The plant will start generating ahead of schedule in August but will only be fully commissioned by June-July, 1998.

Coelho, quoting GTEC sources, said that at least 36 months were needed for a combined cycle generation system to be fully operational.

A capacity of 1,200 mw, in addition to the present captive capacity of 700 mw, had been sanctioned, which the private sector should be encouraged to set up, he said, adding that the policy in this regard was under implementation.

Reliance power corporation chairman D V Kapoor said the concept of independent power producers was introduced by the US about 20 years ago and took seven to eight years to be completely absorbed then. Quoting changed scenarios he said that presently, however, power purchase agreements should be finalised in five to six months. There should be transparency not only in bidding but also in its evaluation.

Kapoor said that a starting point could be made through the privatisation of power distribution, to be followed by funding the expansion, and the technological improvement of such distribution.

He also mooted the idea of inviting bids for coal imports as well as tapping the worlds largest resources of ING in the Middle East, Gujarat being the nearest to it among all the Indian states.