The Maharashtra government is planning to get 1,500 MW of stranded power capacity back on track by reviving private projects which were shut down due to lack of power purchase agreements (PPAs). The non-inking of PPAs left these projects with no buyers for their electricity, and this is what had forced them to stop generation.
The proposal will enable consumers to get power at cheaper cost and revive the idle assets of these independent power producers.
"We are planning a policy to revive around 1,500 MW of shut private power projects. They can enter into private-public partnerships (PPP) with us (state government) contributing equity," said energy minister Chandrashekhar Bavankule. He added that these projects were shut down because of lack of buyers for their electricity in a surplus market as they had not inked any PPAs with distribution utilities like the Maharashtra State Electricity Distribution Company Limited (MahaVitaran).
"The capital cost of new power projects is around Rs8 crore per MW, while these projects were commissioned earlier at a lower cost of Rs5 crore per MW," said Bavankule, noting that the cost of this power would hence be lower than any new power project. "We will contribute the equity and sell the power through the reverse (tariff-based) bidding method," he added.
According to energy department's records, the shut private power projects which have a 1,506 MW capacity include Abhijit Energy, Nagpur (246 MW), Dhariwal Energy (600 MW) at Tadali in Chandrapur, Ideal Energy (540 MW) at Umred in Nagpur and Gupta Energy in Chandrapur (120 MW).
Thermal power makes up for a large part of the Maharashtra State Power Generation Company Limited's (MahaGenco) installed capacity of 11,237 MW. This comprises 7,980 MW coal-based thermal power, 672 MW on gas and 2,585 MW hydro electric projects. It has commissioned around 180 MW solar power projects and plans to take it to around 450 MW by the end of the 2015-16 fiscal, which is one of the highest by state utilities.
The MahaGenco plans to add another 3,230 MW capacity in coal-based thermal power by the end of the 2015-16 financial year.
The state government is planning to scrap the MahaGenco's proposed coal-based projects which were not viable due to higher cost of transporting coal, which in turn, would hike power rates. Instead, this land at Dondaicha, Paras and Bhusawal would be used to establish solar energy projects.