Tata Power loses Rs 3,000 cr equity investment on expensive coal
Tata Power, which is seeking higher tariff for electricity generated from its 4,000 MW Mundra UMPP, has so far seen erosion of more than 60 percent of the Rs 4,500 crore equity investment in the project, according to sources.
“The company has already lost around Rs 3,000 crore of equity investment in the Mundra project since it started power generation in March this year, due to expensive imported coal,” a source in the know said.
Coastal Gujarat Power Limited (CGPL), a wholly-owned subsidiary of Tata Power, is implementing the Mundra project in Gujarat. The first 800 MW unit started generation in March. The flagship UMPP—estimated to cost about Rs 17,000 crore —is being funded in the debt-equity ratio of 75:25.
In recent times, the price of international coal has dropped to around $100 per tonne from $120 per tonne. AFP
The country’s largest private power producer has already approached the Central Electricity Regulatory Commission (CERC) seeking higher tariff, which would help to mitigate losses arising out of pricier imported coal.