NEW DELHI: Private powercompanies said the recommendations of the cabinet secretary-led panel on stressed thermal assets will help the projects but the government should have specified timelines to ensure expeditious implementation.
Association of Power Producers director general Ashok Khurana said a time frame for operationalising these recommendations would help to ensure expeditious implementation. He said the committee should have looked into the long pending demand of issuing an advisory for pass through of cost of coal procured through e-auction to meet Coal India deficit – a measure pending for last 20 months.
The empowered committee headed by cabinet secretary PK Sinha suggested policy measures to revive stressed power plants with improved coal availability, for plants selling electricity in the spot market and forceful measures to ensure timely payments from state utilities with the help of banks.
It also recommended that power plants that terminate power pacts with defaulting discoms be allowed to use the coal supply for electricity supply through short-term power purchase agreements (PPAs) or power exchange for a maximum of two years.
The committee has also asked the power ministry to consider a scheme enabling NTPC to aggregate power through a bidding process from stressed power plants and offer the same to discoms till its own plants are commissioned.
Reserving 60% of coal spot auctions for power plants, change in coal allocation policy to offer future incremental coal without auction to PPA holders and offering more coal to efficient plants have also been suggested.
Power secretary Ajay Bhalla told ET in an interview on Thursday that the panel has made efforts to extensively cover issues raised by private power companies and some of these would not have been possible without a discussion at the cabinet secretary level.
“Some recommendations are really innovative like allowing coal linkage for short-term contracts or bill discounting mechanism to address overdue payments. We would like to see that it is implemented at the earliest for early resolutions of problems. It would also have been much better had the report included measures to create level playing field between private and state/central generators as also echoed by RBI in their representation to government,” said JSW Energy CEO Prashant Jain.
The preferential treatment to state-owned utilities for allocation of power purchase contracts, coal blocks and coal supplies is one of the major reasons for severe stress amongst independent power producers and this anomaly should have been removed, Jain said.
PwC partner (Grid) Kameswara Rao said some of the proposals, such as consolidating coal and power bids and harmonising government approvals are sensible and reduce real risks for future investments.