Tag Archives: Tata Power

Tata Power increases consumer base to 5 lakh in Mumbai

Tata Power has increased its consumer base to 5 lakh consumers in Mumbai in April. The highlight of this milestone was the last leg addition of 2 lakh consumers, consuming electricity below 300 units.

Tata Power’s consumers below 300 units account for almost 65% of its total consumers in the city. These consumers below 300 units category also enjoy lowest tariff in the city.

Besides, the company is undertaking steady network expansion within the city with a focus on 11 clusters post receiving directions from Maharashtra Electricity Regulatory Commission on August 22, 2012.

It has added 695 Kms of cable network till March 2014. In addition to this, Tata Power has added 7 additional Distribution Sub Stations (DSS) and 118 Consumer Sub Stations (CSS), totaling the DSS to 24 DSS and 637 CSS.

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SC ruling may hit BEST’s low-end power consumers in Mumbai

The Supreme Court’s decision to allow Tata Power to supply power in the island city may lead to an increase in tariffs for low-end BEST consumers in the medium term. But it may not impact bus fares, cross-subsidized by the transport undertaking. 

Eateries may lower rates by 5-7% due to cheaper power from Tata, restaurant owners in South Mumbai claimed. But those planning to switch from BEST to Tata may have to wait longer as the apex court stated that Tata will have to set-up its own distribution network. 

BEST general manager O P Gupta said, “Tariffs for low-end consumers will definitely increase as Tata will target high-end consumers. This will prevent us from supplying cheap power to low-end consumers.” 

Revenue expected on the basis of the multi-year tariff plan, approved by the Maharashtra Electricity Regulatory Commission (Merc), may decline. 

Low-end tariff charges are off-set partially because of the cross-subsidy generated due to revenue from high-end consumers, who are supplied power at higher rates. 

Gupta said the power tariff issue will not be clubbed with bus fares. He said, “We may approach Merc to ensure that Tata does not only eye high-end consumers. It should have an adequate number of low-end consumers too.” 

Guruprasad Shetty of Ahar, an association of over 8,000 restaurants and bars in the city, who had first petitioned Merc, said restaurants would save a minimum of Rs 15,000 a month if they shifted to Tata and they would be able to check recessionary trends and pass on benefits to consumers. 

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Source: TOI

Tata Power gains after Supreme Court nod to lay network

Tata Power Company is trading higher by 2% at Rs 77.50 on the BSE after the company said the Supreme Court dismissed the appeal filed by BEST in which it sought to restrain the company from laying its network to provide power supply to consumers in its license area. The stock is the largest gainer among the BSE 30-share Sensex.

The Apex court ruled that there is no provision given in the statute which gives BEST a privileged position of being the sole distribution licensee in that area, Tata Power said in a statement.

The Supreme Court’s ruling allows consumers serviced by BEST in the Mumbai Island City to choose their service provider for electricity. This ruling will foster competition and pave the way for customers to avail competitive tariffs and better customer service, the company added.

The stock opened at Rs 77 and touched a high of Rs  77.60 so far on the BSE. A combined around 125,000 shares changed hands on the counter in early morning deals on the BSE and NSE.

Source: Business Standard

India Puts Wind Forecasting on Hold on Inaccurate Results

An Indian rule requiring wind farms to predict output or face fines has been temporarily suspended as the regulator reconsiders the best way to ensure stability of the grid, which suffered the world’s biggest outage in 2012.

“The mechanism has been put on hold,” said Sunil Jain, chief executive officer at Hero Future Energies Pvt. and president of the Wind Independent Power Producers Association.

The Central Electricity Regulatory Commission last year ordered wind farms to predict their day-ahead generation within a 30 percent band. Developers including Tata Power (TPWR) Co. and Goldman Sachs Group Inc.’s ReNew Wind Power Pvt. protested the directive, saying it was impossible to comply with and that penalties would wipe out profits in an industry that has drawn about $10 billion of investment since 2011.

“Not a single project has been able to produce data within the margins,” Jain said in an interview in New Delhi this week. “It defeats the purpose. It’s too inaccurate.”

Gireesh Pradhan, chairman of the Central Electricity Regulatory Commission, wasn’t available to comment by phone and didn’t respond to an e-mail.

Forecasting of wind generation, an intermittent energy source, is carried out to help stabilize the grid in some parts of the U.S. and Europe, where surging wind output has driven wholesale electricity prices below zero and forced utilities to pay consumers to take power as supply exceeded demand. In India, scheduling would allow wind power to be sold across states and help authorities prepare network upgrades to accept more clean energy in the future.

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Why CERC’s compensation to Tata, Adani for high coal prices sets dangerous precedents and dents competition

An effective bailout, amounting to a couple of thousand crores, of power plants owned by the Tatas and Adanis by the Central Electricity Regulatory Commission (CERC) sets many deeply worrying precedents for the power sector. Perhaps the biggest one is that it questions the basic principle underlying electricity reforms since the ’90s — the competitive procurement of electricity.

Till now there were two ways to set ‘wholesale’ power prices — the price of power paid by a distribution company to a power plant. There was the earlier costplus method which still applies to public sector power producers like NTPCBSE -2.51 %. Under this system, power prices are regulated and capped after allowing for costs and a defined profit margin. The cost-plus method had a number of problems, the most obvious being it gave an incentive to a power producer to pad costs. Also, there was less pressure on the producer to be efficient.

he other method — competitive bidding — was seen as the solution to the problems of the first. A distribution company looking for sources of power to supply customers would ask power producers to bid a tariff at which they were willing to supply power, with the winner being the one offering lowest tariff. The tariff set under this process was more or less sacrosanct, with revisions being allowed only under extreme circumstances.

What the CERC order does is effectively provide a way for ..

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Source: Economic Times

Haryana to pay more for power purchase from Adani & Tata

Haryana to pay more for power purchase from Adani & Tata
Sunday February 23 2014

The purchase of 1424 MW by Haryana from Adani’s Mundra thermal plant in Gujarat has become costly after Central Electricity Regulatory Commission (CERC) allowed compensatory tariff for increase in cost of imported coal from Indonesia.
CERC in its decision of February 21 on petition no.155 of 2012 has granted compensation to Adani Power for higher costs of Indonesian Coal. Haryana has to pay Rs. 409.51 crore as compensation for the period up to March 31 2013 in thirty six installments . The compensatory tariff for the current financial year is likely to be 62 paise per unit .
There may be reduction on this if Adani sells power on merchant basis if the power generation exceeds 80% and profits are shared with Haryana. Assuming a share of 19 paise in income from merchant sales, Haryana would have to pay minimum 43 paise more for one unit of power. The compensatory tariff mechanism for both the power plants will be reviewed after three years.
Adani Power has signed two power purchase agreements in August 2008 with Haryana utilities — Uttar Haryana Bijli Vidyut Nigam Ltd and Dakshin Haryana Bijli Vidyut Nigam Ltd for the supply of 1,424 MW of power for 25 years. The power from unit 1 started on August 7 2012 and from unit 2 &3 from February 7 2013.
Haryana Government has proposed no tariff hike for the power consumers of the state in election year as it has agreed to financial restructuring plan of Government of India. It will interesting to see how this is passed on to consumers under the grab of fuel adjustment charges after the elections.

Last April, while allowing a hike in tariffs for the two projects, CERC had set up a panel headed by Deepak Parekh to work out compensatory tariffs to mitigate the adverse impact of higher prices of imported coal.
Besides reduction in interest rates, CERC has r also recommended extending a moratorium on principal repayment for two-three years and an extension in the loan repayment period and to approach appropriate authorities in this regard.

The CERC’s recommendations were based on the suggestions of the Deepak Parekh committee set up last year to arrive at compensatory rates for the two imported coal-based power plants of Adani and Tata Power at Mundra, Gujarat.
In a similar order by CERC issued on Friday the purchase of 3800 MW by Punjab Haryana Rajasthan, Maharashtra and Gujarat from Tata’s Mundra UMPP in Gujarat has become costly after Central Electricity Regulatory Commission (CERC) allowed compensatory tariff for increase in cost of imported coal from Indonesia. All the five procurer states has to pay Rs. 329.45 crore in the ration of their share as compensation for the period up to March 31 2013 in thirty six installments . The compensatory tariff for the current financial year is likely to be 52.40 paise per unit .
Punjab has 12.5 % share in Project ,Haryana & Rajasthan have 10 % share each, Maharashtra 20% and balance 47.5% is for Gujarat

Tata Power to invest Rs 1,500 cr in renewables

Tata Power plans to keep up with its annual investment of Rs 1,500 crore in renewable energy, even as the company’s net worth is being eroded by its flagship coal-based project inMundra.

“We have a lot of support from the board of directors when it comes to our renewable energy plans. So, I am sure we will get the equity required from them,” said Rahul Shah, chief of business development and renewables at Tata Power.

The company had been under the cloud of Mundra, which became financially unviable after Indonesia changed its coal export laws. The 4,000-megawatt (Mw) imported-coal based project has been eating into the balance sheet of the company, as it has already taken impairment losses of around Rs 2,500 crore.

Tata Power would require around Rs 400-450 crore of annual equity for expanding its renewables capacity. The company plans to add as much as 150-200 Mw of wind and 30 Mw of solar capacity every year. The company, which has a total capacity of 8,521 Mw, produces 500 Mw from renewable sources.

The company has also decided to house its renewable energy projects into a new special purpose vehicle (SPV). “We have 375 Mw of old capacity in Tata Power’s books. But the rest is part of the new project,” said Shah.

The company has plans to monetise the SPV to raise its own equity. “But the equity raising plans is two years away, which is when we will reach a critical mass,” said Shah.

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Source: BS

CERC order on Mundra UMPP likely this month-end: Tata Power

Tata Power, nation’s largest private power producer, has said the electricity regulator CERC’s order for granting compensatory tariff for the company’s Mundra project is likely to come up by month-end.

“CERC has finished the hearings and Maharashtra Electricity Regulatory Commission ( MERC) and has just submitted their affidavit about
few days back on November 26 and now they have given time for us to file an affidavit to give our rejoinder on that affidavit,” Tata Power Managing Director Anil Sardana told CNBC-TV 18.

He said, “After that perhaps they will take another two-three weeks. So, I am hoping that by end of December we could hope for the order.” Central Electricity Regulatory Commission (CERC), in April this year, allowed the private utility to raise power tariffs from its 4,000-MW Mundra ultra mega power project in Gujarat, to compensate for an unexpected increase in coal cost.


Source: ET

Tata Power announces 61% increase in power generation

 Tata Power on Wednesday announced generating 22,738 MUs of power collectively from all its power plants in first half of the financial year 2013-14 as compared to 14,029 MUs in the same period of the previous year.

This marks a 61% increase in generation, with the total power generation capacity of Tata Power standing at 8521 MW from various fuel source: thermal (coal, gas and oil), hydroelectric power, renewable energy (wind and solar PV) and waste heat recovery, reinforcing its position as the largest integrated power company in India.
Breaking the previous records in generation performance, its subsidiaries CGPL and MPL have continued to contribute significantly to the increase in generation capacity, with 11,574 MUs and 2,930 MUs respectively.


Source: ToI

Tata Power scouts for investment opportunities abroad

Tata Power is scouting for investment opportunities and assets overseas to spread the risk and grow.

The company, which has already lined up several power projects in many countries, said it would concentrate on Africa, Southeast Asia, the Middle East and the SAARC (South Asian Association for Regional Co-operation) region to grow its overseas business.

Multiple reasons

“There are multiple reasons to make a foray into the international market, and it is not just due to the fact that today there are tremendous challenges in India, which seem to be lingering for too long. Firstly, land issues. Secondly, most States are claiming to become surplus, suggesting that they do not need any extra power. In addition, there are not too many opportunities that one sees on the horizon,” Tata Power Managing Director Anil Sardana told The Hindu.

“With the result, whenever an opportunity comes, there is tremendous competition, which renders that particular opportunity completely unviable. But perhaps this is one of the reasons that would deter one from investing more in India,” Mr. Sardana said.

“One must give credit to opportunities that exist outside. It is not that since one finds challenges in India, one decides to move out. The opportunities in countries outside are more predictable, far less risky, and the attitude of select nations is progressive towards foreign investment. These factors also prove positive for the company to go there. It is important for faster clearance of these investments by respective governmental institutions,” Mr. Sardana added.

Tata Power has prioritised four key regions — Africa, Southeast Asia, the Middle East and SAARC — for its international play.

The company has deployed resources in these regional geographies to understand the market dynamics and scout for opportunities.


Source: The Hindu



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