How coal-power policy has unplugged independent producers
Over the last decade, India’s coal-based power generation capacity increased by nearly 2.5 times to 198 gigawatt (GW), courtesy an investment rush by the private sector, which now controls 47 per cent of the total coal-power capacity. The share was less than nine per cent in 2009.
Higher stakes should ensure more favourable terms for the private sector. But the reverse happened.
According to the Association of Power Producers (APP), Independent power producers (IPPs) are facing a double-whammy in the form of competitive bidding both for fuel purchase and long-term electricity sales to distribution utilities (DISCOMs).
In contrast, the public sector, led by NTPC, gets fuel at the price notified by Coal India (CIL) and sells electricity on a “cost-plus” basis to DISCOMs.
