The Hindu Business Line : Power distribution utilities strike swap deals to tide over shortages

New Delhi, March 25 A situation of shortage of power is forcing distribution utilities to resort to swap deals, including seasonal electricity “banking arrangements”. Under a “banking arrangement” — an industry term for swapping of equivalent power between utilities — the Himachal Pradesh State Electricity Board (HPSEB) and Tata-owned North Delhi Power Ltd (NDPL) are currently exchanging electricity. Under this deal, NDPL — which is one of the three private companies distributing power in Delhi — made available around 157 million units of power to HPSEB during the winter months from October 2007 to February 2008, while HPSEB is slated to return an equivalent quantum of banked energy to NDPL during the summer months of this year, from June to September 2008.

“This arrangement between NDPL and HPSEB is in the form of energy exchange only and no cash transaction is involved,” an official involved in the exercise said.

Haryana and Punjab have also struck similar ‘banking arrangements’ with Uttarakhand Power Company Ltd, under which power is drawn from Uttarakhand during the peak months of summer to meet the agriculture load and is returned during the lean demand period of winter months.

“The swap deals are cash neutral and work in favour of both States to tide over seasonal peaking shortages, when overdrawing from the grid generally proves to be expensive. For instance, while Delhi is slated to get power from HPSEB this summer under the swap arrangement, the Uttar Pradesh Power Corporation Ltd (UPPCL) was forced to quote an exorbitant rate of Rs 7.01 per unit for power that it wants to purchase outright from HPSEB from April this summer,” an official said.

Coal for power

In a different form of a swap agreement, the Gujarat Government-owned GMDC (Gujarat Mineral Development Corp) has struck a coal-for-power deal with project developers Torrent Power and KSK Energy Ventures, under which GMDC will get Gujarat access to a major chunk of 2,750 MW to be generated from two upcoming joint venture projects in Chhattisgarh, in lieu of the developers being guaranteed coal from the Morga II coal blocks owned by GMDC in Chhatthisgarh.

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