Though the Power Ministry is drawing up ambitious plans for capacity addition in the Twelfth Plan, fuel supply continues to be a hurdle.
Mr Sushilkumar Shinde, Power Minister, said the Government was trying to find solutions to address fuel supplies issues. In fact, one of the reasons for not achieving the Eleventh Plan target fully is fuel shortage — both coal and gas.
“Otherwise, I could have certainly reached the 78,500 MW target, which was brought down to 62,000 MW in the mid-term appraisal,” he said. But in Twelfth Plan, the target is to achieve 75,785 MW, the Minister added. The capacity addiion in the 11th Plan was 53,922 MW as on March 29, 2012.
“The 4,000 MW gas-based power plants planned during the 12th Plan are unlikely to come up if the current situation continues,” Mr Arup Roy Choudhury, Chairman and Managing Director, NTPC, said.
The power producers have received a directive from the Government to put on hold gas-based projects till supplies are tied up. Mr Choudhury said, as a caution, NTPC never goes ahead with projects where fuel supplies are not in place.
A gas-based project can come up in 24-30 months, so if the supplies are tied up, the company can still go ahead with a project, he said.
When asked at what gas price the power companies would be comfortable, the Power Minister, while remaining non-committal, said it was dependant on international and national markets.
On coal, he said, around 90 per cent of NTPC’s fuel requirement is met domestically via its long-term contract with Coal India. The remaining 10-15 per cent is met through imported coal, which is expensive.
On whether he was hopeful that Coal India will sign the fuel supply agreements (FSA), the Minister said, “I understand there are some technical problems, which CIL is trying to solve. We are confident that the FSAs will be signed.”
The Prime Minister’s office has directed CIL to ink the FSAs by March 31.