NTPC delays Ramagundam plant, Telangana Discoms forced to purchase power

NTPC's failure to commission two 800MW units of STPS at Ramagundam is forcing Telangana Discoms to purchase electricity from Indian Energy Exchange at high price

Hyderabad: The failure of the National Thermal Power Corporation (NTPC) to commission the two 800MW units of the Super Thermal Power Station at Ramagundam is forcing power utilities (Discoms) in Telangana to purchase electricity from energy exchange platform, Indian Energy Exchange (IEX), to meet the power demand in the State.

It is estimated that the discoms were purchasing about six to seven crore units on a daily basis from the exchange platform. In the last three months alone, the purchase from IEX has reportedly cost the discoms up to Rs 2,500 crore.

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According to power utilities officials, discoms were purchasing power from IEX at a maximum rate of Rs 12 per unit, which is much higher than the per unit cost the discoms spend on purchasing from power stations directly.

“If production had started at STPS Ramagundam, per unit of power would have cost only Rs 5.50 and the Discoms would have saved crores of rupees. Discoms are already under severe financial stress and the power purchase from IEX is breaking their backs,” a senior official said.

Even Transco and Genco Chairman and Managing Director D Prabhakar Rao raised concerns over the Discoms being forced to purchase power from IEX. During the 45th Southern Region Power Committee meeting at Pune on Saturday, Prabhakar Rao raised the issue of the failure of NTPC to commission STPS, Ramagundam and blamed the Corporation for forcing Telangana Discoms to purchase electricity from IEX to meet the demand of the State.

He said the NTPC was supposed to commission STPS, Ramagundam last year but failed to meet the deadline, following which Telangana was forced to purchase power from the exchange platform, which was putting additional burden on the exchequer. He urged the NTPC authorities to commission both units immediately.

According to a senior Genco official, the investment approval for the project was accorded in January 2016 and the NTPC was supposed to commission the first phase by November 2020, but it could not meet the deadline due to the Covid-19 pandemic and the deadline was extended to July 2022.

However, NTPC failed to meet the deadline again and is now expected to complete the project by June this year.

“About 86.3 percent of the project has been completed. NTPC has assured us that the project will be completed by June. We hope that this time they will not miss the deadline,” he said.

According to Central Electricity Council (CEA) guidelines, production should start within 48 months from the start date of construction of the new power plant, but in the case of STPS Ramagundam, the NTPC has failed to keep the deadline, officials pointed out.