Indian government-owned and -operated power producer NTPC has decided to acquire "stressed thermal power plants", but only those that are equipped to use domestic coal as a feedstock.
The country's largest power utility, NTPC, will pursue inorganic growth by acquiring thermal power projects wherein promoters have defaulted in servicing debt raised from financial institutions and are looking to shed the assets that are already completed and commissioned.
However, NTPC has stipulated that it will only buy thermal plants that are designed and manufactured by domestic thermal power plant equipment manufacturers and equipped to use the widely available high ash content thermal coal.
The proposed acquisition will be limited to assets with a capacity of 500 MW or higher, or sub-critical and super critical plants which have been made operational after April 1, 2014. It is estimated that there are 40 GW of aggregate power generating capacity that financial lenders have categorised as stressed assets.
Sources say that the stipulation for "only domestic coal usage" is in line with NTPC's strategic policy already in place that no coal be imported for any of its existing or future projects.
Last year, NTPC stopped new contracts for the supply of imported coal, which, at its peak, averaged about 16 million tonnes a year.
India's Power Ministry has directed all thermal power producers, government and private companies to completely stop coal imports over the next three years. The Coal Ministry has already put in place guidelines of assured coal supplies to all independent power producers that have constructed thermal power plants based on imported coal.
While power industry sources say that it is doubtful whether the target of reducing imported coal dependency to nil over three years will be feasible, Indian coal imports have been on a decline in recent months.
According to data sources from ports, total thermal coal imported between April and October 2017 was estimated at 33 million tonnes, down from 46 million tonnes during the corresponding period of the previous year.
NTPC currently operates 20 coal-based thermal power plants with aggregate generation capacity of 38,755 MW. Its strategic plan included a generation target of 128,000 MW by 2030.
(Writing by Becky Du Editing by Tammy Yang)
For any questions, please contact us by email@example.com or +86-351-7219322.