Companies

NTPC-BHEL power gear unit finally up, but downsized

Somasekhar Hyderabad | Updated on January 15, 2018 Published on November 25, 2016

A view of the main entrance of NTPC-BHEL Power Projects (NBPPL) in Mannavaram, Andhra Pradesh   -  KV Poornachandra Kumar

After eight years, many twists and turns and delays, the ₹6,000-crore joint venture between two public-sector majors — NTPC and BHEL — to manufacture power equipment has finally got into production mode at Mannavaram in Chittoor district of Andhra Pradesh.

The NTPC-BHEL Power Projects Limited (NBPPL), whose foundation was laid by former Prime Minister Manmohan Singh on September 1, 2010, has seen an investment of ₹363.94 crore, in what is termed as Phase-I, and got into commercial production in mid 2015.

Perceived as the first major manufacturing unit in the public sector that would be a game-changer in the backward Rayalaseema region of Andhra Pradesh, the project was sanctioned in 2007 and a JV agreement signed on December 17, 2007. After initial fast-track moves, it ran into rough weather. The then Chief Minister of combined Andhra Pradesh, YS Rajasekhara Reddy, was instrumental in using his political strength with the Congress(I)-led UPA government in bringing the project to the State, against stiff competition from Maharashtra, Karnataka, Tamil Nadu etc. However, his untimely death in 2009, the subsequent State bifurcation agitations and lack of clarity between the JV partners, resulted in the project progressing at a very slow pace.

As per a reply by the Union Minister of Power to a starred question in the Rajya Sabha on November 21, by an MP of the YSR Congress Party, the Phase-I investment was reduced from the original ₹1,200 crore (EPC and Manufacturing facilities) to ₹363.94 crore by curtailing EPC expenditure to ₹13.55 crore by shifting to a hiring model.

It was also decided that NBPPL will go in for Phase-II in 2016-17. The estimated employment opportunities would be 6,100 till the end of fiscal 2016-17, as per a detailed project report. In Phase-I, it would be 1,250, with the JV expected to execute 30 EPC orders and other related projects, the Power Minister said.

The delays have been attributed to infrastructure bottlenecks, such as lack of straight and good roads to handle the giant-sized consignments, and assured water supply. Consequently, the Boiler, Turbine and Generator (BTG) unit, a vital component of the project, was shifted to Phase-II. NBPPL, which has an agreement to supply spare parts to the NTPC, has also signed an MoU with APGenco (Andhra Pradesh Power Generation Corporation Limited) for supply of spare parts for coal- and ash-handling plants and other equipment required by the Andhra Pradesh power utility’s thermal power plants.

The basic objective of the company is to enhance the capability and capacity of the power sector and supplement the efforts of both the promoter companies, NTPC and BHEL, in the long run.

Published on November 25, 2016
This article is closed for comments.
Please Email the Editor