Gas prices in international spot markets are at lowest at about $3 per mmbtu, a boon for the ailing Rs 1 lakh crore power assets if the Centre is able to pull off the proposed revival scheme announced in the budget for 2019-20.
The present prices may be short-lived, with some countries banning Chinese shipments due to Covid-19 scare, but experts said the rates are likely to be in the range of $4-4.5 per mmbtu for a few more years owing to less demand and excess supply.
ET had reported on January 7 that the Union power ministry had finalised two schemes to procure 4,000 MW from gas-based power plants to rescue the stranded plants. The schemes include procuring 2,000 MW from gas-based plants through auction and bundling it with an equal capacity of solar power. Another 2,000 MW will be procured through online reverse auction, on a model similar to previous such schemes.
A senior government official said the scheme is close to finalisation and will be put up before the Union Cabinet for approval. He, however, said approval from state governments on waiver of taxes is still pending.