Odisha govt tells Centre to scrap PPAs with newer NTPC projects

Faced with the prospect of a glut in thermal power supplies from 2020 onwards, the Odisha government is keen to renege Power Purchase Agreements (PPAs) signed with NTPC projects which is due to start commercial operations.

Accordingly, the state government has requested the Centre not to allocate power from the NTPC’s stations coming up at Katwa (West Bengal), Pirpanti and Nabinagar-II (both in Bihar) and cancel the PPAs executed between the Maharatna Power Producer and Gridco, the state-owned bulk power trader. The decision to scrap PPAs stems from the availability of surplus coal-fired power from generating stations inside the state.

At state share, Odisha is entitled to 800 Mw power from NTPC’s ensuing 1600 Mw super thermal power station at Darlipalli near Sundargarh. That apart, state-owned Odisha Power Generation Corporation (OPGC) will feed its entire 1320 Mw to the state grid after its ongoing expansion.

“Several NTPC stations for which the state designated entity Gridco has signed PPAs earlier taking into account the forecasted demand growth as per 18th EPS (Electric power Survey) have not put into commercial operations yet by NTPC. Allocations from such plants have not been made by the Ministry of Power, therefore, the state government requests the Centre not to allocate any power from such projects”, Odisha’s Energy Minister Sushanta Singh said at the recent meeting of State Power Ministers in Delhi.

The Minister also overlooked Odisha’s old demand to de-allocate power from NTPC stations located beyond the state. Gridco, which had once requisitioned for availing power from such NTPC projects, was now witnessing flagging uptake of power due to recessionary trend in industries.

Industries were availing open access and installing their captive generating plants, hurting power demand. Odisha’s case for surrender of excess power is also buttressed by greater power availability within the state.

“The availability of generation inside the state has been increased due to revision in home state quota from 10 per cent to 50 per cent in the upcoming power projects like NTPC’s Darlipalli inside the state from where power is available at cheaper rate being pit head power stations as compared to the existing or upcoming NTPC generating stations located outside the state. Though Odisha has requested the Ministry of Power (MoP) several times to de-allocate its share, it has not been done yet”, Singh said.

A clutch of NTPC owned coal based generating plants like Barh-II and the Muzzaffarpur Super Thermal Power Stations have begun commercial operations. Though Odisha is not availing power from such stations, it is bearing the fixed cost liability.