NTPC offers to sell power directly to India Inc

In a deviation from its standard practice, state-run power producer NTPC has invited expressions of interest (EoIs) from electricity distribution companies (discoms) and industries to purchase electricity from its “spare generation capacity”.

NTPC traditionally supplies power directly to discoms, mostly under long-term power purchase agreements (PPAs). This is the first time the company is offering to sell power to corporates and industrial consumers on an open access basis.

Currently, all 52,000 megawatt (MW) of NTPC’s operational capacity and 15,000 MW of under-construction coal-based stations are tied up with assured power off-take agreements. In fact, in the three months before the January 2011 deadline for shifting to competitive bidding regime, the company had entered PPAs for 40,840 MW of its capacities on a ‘cost-plus’ basis with 37 state-run discoms.

“However, NTPC may have some spare generation capacity available for sale in open market,” and it “intends to sell this energy to the interested buyers”, the company said in the notice inviting EoIs.

The development closely follows the Central Electricity Regulatory Commission allowing one of Delhi’s discoms, BSES, to approach the Union power ministry to de-allocate 621 MW of electricity supply from NTPC’s Dadri-I generating station earlier in the month.

The government has ruled that discoms can stop buying power from plants that are older than 25 years, and the Dadri-1 unit is one such unit.

Financial express
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