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Home KSEB Cruel summer may prove costly for KSEB Limited

Cruel summer may prove costly for KSEB Limited

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SummerSummer 2017 is likely to impose massive financial liability on the Kerala State Electricity Board(KSEB Limited) as it may be forced to bank on extremely costly electricity to avert power restrictions.
In the present scenario, the power utility will have to purchase high-cost electricity from liquid fuel stations within the state including NTPC Kayamkulam to avoid power restrictions during the summer, the KSEB informed the State Electricity Regulatory Commission on 17-01-2017.

"To avoid power cuts and load-sheddings, there is no alternative but to purchase power from Kozhikode Diesel Power Plant(KDPP), Brahmapuram Diesel Power Plant(KDPP) and the NTPC's Rajiv Gandhi Combined Cycle Power Project(RGCCPP), Kayamkulam,'' N S Pillai, KSEB director (finance) told the commission during a hearing on the proposal to hike power tariff. ''RGCCPP is required to tide over the summer without power cuts,'' he said in a presentation.

The average cost of power from all three stations is above '6.50 per unit at present. Currently, no power is being scheduled from these stations, and KSEB had stopped purchases from the naphtha-fuelled NTPC unit after the latter demanded higher fixed charges. KSEB procures coal-based power from outside the state at an average cost of approximately ' 4.25 which makes procurements from the liquid fuel plants unviable. Although several power deals have been struck with companies outside the state, the lack of space on the transmission lines is proving a major headache for the KSEB.

However, in a bid to ensure additional power flow during summer, the KSEB has also urged the regulatory commission to urgently provide clearance to several long-term power purchase deals worth a total 565 MW. These deals were part of a 865 MW bouquet KSEB signed under the 25-year Design Build, Finance, Own, Operate(DBFOO) scheme. However, the commission had cleared only 300 MW worth of purchases and denied clearance to the rest citing procedural anomalies.

The KSEB official informed the commission that hydel reservoirs have witnessed the lowest ever inflow this season at a mere 49.3 per cent. While the power utility is expecting an average daily demand of 72.7 million units (MU) per day from January to May, water levels will allow it to generate only 10.1 MU from hydel sources.
At the hearing, the KSEB refuted the regulatory commission's finding that the KSEB will have a revenue surplus in 2016-17 and 2017-18. The present ''unabridged'' revenue gap of the KSEB stands at a whopping '10,791.05 crore. The half-yearly loss, as on September 2016, is pegged at '730.33 crore.

Source- TNIE


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