The Kayamkulam station of the National Thermal Power Corporation (NTPC) is facing the gravest crisis in its 17-year history. Considered an asset to Kerala earlier, the plant has been remaining idle for most part of the year. Unable to resolve the crisis sparked by rise in fuel cost at the naphtha-based plant, the government is exploring unconventional options, including shifting of the plant, in a bid to wriggle out of the trying situation.
The plant, also known as Rajiv Gandhi Combined Cycle Power project, has been facing poor demand arising out of the high cost of production. Rise in prices of naphtha, the fuel used in the plant, has been the main reason behind the unprofitable operations. The NTPC has already converted the machinery to receive natural gas for producing electricity, but the gas pipeline connectivity is posing a major hurdle.
The State government has mooted shifting of the 350 MW power plant to Kochi so as to utilise the natural gas readily available through pipes from Petronet LNG Limited terminal at Puthuvype, for power generation at cheaper cost. In response to a request made by the State, the union government has directed the NTPC to make a techno-feasibility study on the same. Top officials have visited the plant at Kayamkulam as a preliminary step, reliable sources in the company said.
Though natural gas could be transported to Kayamkulam through barges, the transportation cost would add up to the generation cost, again raising the unit price of electricity that could invite poor demand. Transport of gas tankers from Kochi through the highly congested roads is not recommended by experts.
The NTPC has been planning to raise the capacity from 350 MW to 1050 MW, but the Kerala State Electricity Board, the main beneficiary, has refrained from making a power purchase agreement to buy the additional units to be generated at the plant. Nevertheless, the State government has to pay about Rs.20 crore every month to the NTPC irrespective of buying power from the public sector company, as per the original agreement.
The union government has halted the expansion of capacity of gas-based projects due to high cost of natural gas, M. Shivasankar, chairman of KSEB, told The Hindu . The State is buying power from the Kayamkulam plant, as a stop-gap arrangement during emergency since the cost is high. The proposal to relocate the facility to a place with gas connectivity has been pending and the Central Ministry of Power has sought a techno-feasibility report, he said.
A senior official of the NTPC said the study would include the expenses of shifting which could again be a component of the overall cost involved in the generation of electricity at the new location. A time frame for such a study has not been set at present, the official added.
The present crisis is a direct fallout of the inability of the authorities to establish the natural gas pipeline connectivity from Puthuvype to Kayamkulam. A proposal for an undersea pipeline from Kochi to Kaymakulam had received clearance from the Ministry of Environment several years ago. There were some objections from the fishermen community, but there had never been a serious attempt to sort out the issues to take up the project in right earnest.
Source- The Hindu