BHUBANESWAR: The power purchase agreement signed by the Grid Corporation of Odisha Limited (GRIDCO) with NLC India Limited (NLCIL) in September last week for procurement of 800 MW from the proposed super critical thermal power station at Talabira in Sundargarh district has raised eyebrows.
The move has come in for question as the state’s entitlement is 1,600 MW and it is going to lose 800 MW of cheap power in the process. NLC India, a subsidiary PSU of Ministry of Coal, is in the process of setting up a pit-head thermal power station of 3,200 MW (4x800MW) capacity in two stages. The Central PSU has proposed to implement 3,200 MW (3x800MW) in stage-I and another unit of 800 MW capacity in stage-II at an estimated cost of Rs 16,184 crore.
As per the Central guidelines, states where the thermal power projects are set up are entitled for 50 per cent allocation of the firm power to be generated while 35 per cent will be distributed among other states. The remaining 15 per cent unallocated power will be at the disposal of the Power Ministry for meeting urgent requirement.
The revised guidelines which came into effect from January 5, 2011 also mandated that power is to be procured by the distribution companies/utilities through tariff-based competitive bidding.Since NLCIL is setting up three units of 800 MW capacity in the first phase, the state is entitled to get an allocation of 1,200 MW and another 400 MW from the fourth unit. Curiously, GRIDCO signed PPA with NLCIL for 400 MW each in stage-I and stage-II surrendering 800 MW to the project developer.
While GRIDCO bosses are tight-lipped, sources familiar with the development said, “We are going to commit the same mistake that the then government did in the 90s by surrendering 500 MW power to NTPC from its super thermal power station at Kaniha. The state refused to buy more power from NTPC on the plea that it has surplus power but regretted later for surrendering cheap power.”
The power to be generated from the Talabira project will be much cheaper because the thermal power station will be in proximity of Talabira II and III coal blocks which have been allocated to NLCIL. With assured fuel linkage and least cost on coal transportation, the unit cost of power will be in the range of Rs 2.50 to Rs 2.75, the sources maintained.