Business Daily from THE HINDU group of publications
Monday, Jul 23, 2007
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Business Daily from THE HINDU group of publications Monday, Jul 23, 2007 ePaper |
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Cement Industry & Economy - Power Corporate - Outlook Madras Cements glows on captive power
A view of the company’s unit in Tamil Nadu
N. Ramakrishnan Chennai, July 22 Madras Cements Ltd is betting big on captive power. The company meets the power requirements at its plants entirely through captive power –— either thermal or wind –— which the company says gives it considerable savings in power costs. By the end of this year, the company will have 125 MW of installed wind power capacity and 72 MW of coal-based captive power plants. The company has two plants in Tamil Nadu, one in Andhra Pradesh and another in Karnataka with a total installed capacity of 6 million tonnes (mt) of cement a year. It proposes to put up a 2 mt a year plant in Tamil Nadu, for which it will have wind turbines to meet the power requirement. Production capacity will shortly go up to 8 mt, when it commissions a 4,000 tonnes a day additional clinker unit at its Andhra Pradesh plant and to 10 mt next financial year when the 2 mt greenfield unit in Tamil Nadu begins production. Power and fuel costs account for nearly 60 per cent of the variable cost of production of cement. Madras Cements consumes about 70 kilo-watt hours (kWh) of electricity for a tonne of cement and it saves between Re 1 and Rs 1.30 a kWh by using its captive power sources. For instance, power generated from its captive thermal plant in Tamil Nadu, which uses imported coal, costs about Rs 3.10 a unit while grid power costs Rs 4.30 a unit, including the maximum demand charges. The average cost of purchased power works out to Rs 3.73 a unit while that from its coal-based captive power plants (both in Tamil Nadu and Andhra Pradesh) works out to Rs 2.41 a unit. Wind power –— excluding capital cost, interest and depreciation –— will work out to about 50 paise a unit. Wind power
The company now has an installed capacity of 65 MW of wind power in Tamil Nadu and Karnataka, and has coal-fired captive power plants at one of its plants in Tamil Nadu and Andhra Pradesh. During this year, Madras Cements will install about 60 MW of wind power at an investment of Rs 330 crore taking its total installed capacity to 125 MW. The company’s total investment in wind power will go up to Rs 630 crore by the end of this financial year, according to Mr A.V. Dharmakrishnan, Executive Director - Finance, Madras Cements Ltd. It set up its first wind farm of 13 MW in 1993-94.
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