India’s power sector, guilty in the past of adding significantly to the pile of bad loans, is seeing a revival in demand with growth in power consumption every month, the chairman of the country’s biggest power producer said Wednesday.
“Power demand is coming back…it is an optimistic scenario,” National Thermal Power Corporation (NTPC) chairman Gurdeep Singh said. “It is not only that power is going into the houses that are electrified but the industry has also started picking up.”
Singh, however, said that production of coal, which feeds thermal power plants, needs to keep pace with the growth in demand. Growth of power consumption in July stood at 7.94%, according to the latest data. In the first quarter of the current fiscal, consumption growth stood at 7.5%. This could further increase.
“There are early indications. For instance, demand for power from our high-cost plants such as Dadri and Mauda is also improving,” he said.
On the raw material front, NTPC is steadily increasing production of coal from the eight blocks it was awarded. With two mines that have already begun production, Singh said he eyes output at 8.5 million tonnes next year, increasing from 6.5 million tonnes this year. “The total capacity can go up to 100 million tonnes in the next 8-10 years,” he said.
Bloomberg had reported last week that the government is considering selling its stake in National Hydroelectric Power Limited (NHPL) to NTPC to give the energy companies global size and scale and boost revenue collections.
“Any deal is a good deal provided it is at a right price,” Singh said, not divulging further details and calling the report speculative. Singh also said the company was keen to acquire hydro power producer SJVN and had communicated with the government last year on the subject. “There has been some response but since it is a JV with Himachal (Pradesh), they had their own thinking,” said Singh.
