Financial Daily from THE HINDU group of publications
Sunday, Jan 02, 2005
Financial Daily from THE HINDU group of publications Sunday, Jan 02, 2005 |
|
|
|
|
|
Home Page
-
Power Corporate - Outlook Tata Power bets on coal-based projects Archana Chaudhary
Mumbai , Jan. 1 AT a time when other power producers are considering natural gas as a replacement for costly oil, Tata Power Company has decided to bet big on coal. The company hopes to invest Rs 40,000 crore in thermal power plants — the smallest with a capacity of 1,000 MW — if it gets coal-mining rights. In November 2004, Tata Power, applied for mining rights at five coal blocks in Jharkhand, Orissa and Andhra Pradesh. It plans to set up plants at each of these sites. "Tata Power already has the expertise in thermal power, thanks to its 1,350 MW Trombay project, where it uses imported coal. There is uncertainty around the availability and price of natural gas. If gas prices are linked to international prices in the future, which they undoubtedly will, the price of gas-based power will also shoot up. India has abundant coal and we see this as an opportunity," a senior Tata Power official said. The company's strategy would be to set up coal pithead power projects to cut supply interruptions and transport costs and transmit power to high demand circles such as Delhi and smaller cities. The company has pitched for blocks at Auranga coalfield (2,000 MW) in Jharkhand, Godavari Valley coalfield (1,000 MW) in Andhra Pradesh, Talcher coalfield (3,000 MW) in Orissa and the North Karnapura coalfield (2,000 MW) and Saharpur and Jamanpari coal blocks (2,000 MW) in Jharkhand. This is in addition to the two coal blocks it acquired in April 2003, at the North Karnapura coalfield in Jharkand. The company plans to set up a 1,000 MW power project here. "All these plans will of course materialise if and only if we are allotted these coal mines," the official said. The Union Government recently amended the Coal Mines (Nationalisation) Act, 1973, to allow mining by iron and steel and power companies for captive use. Tata Power, the country's largest private power producer, is also exploring possibilities of partnering with sister company Tata Iron and Steel Company to set up captive power projects at the coal mines. Although demand for power in India is high, the consumer is not willing to, and in most instances cannot afford to pay over Rs 3.50 a unit, which is the price of the cheapest gas-based power. Power generated from coal can be as cheap as Rs 1.50 to Rs 2 a unit, according to a senior analyst. Over 60 per cent of the country's one lakh MW installed capacity, mostly owned by NTPC, produces power from coal. The State-owned NTPC is also looking to float another company that would own mines to meet its coal requirement. In November 2004, the Power Ministry had warned of a possible massive 50 million tonne coal shortage over the next 2-3 years that could trigger a major crisis, especially if the new capacity addition target of 41,000 MW during the Tenth Plan is met. According to reports, the Power Ministry is in favour of pushing the Coal Mine De-nationalisation Bill to streamline allocation of captive coal blocks.
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2005, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|