UPCL waiting for govt nod for synchronisation

Mangalore Today News Network

Udupi, March 4: The Udupi Power Corporation Limited (UPCL), a subsidiary of Lanco Infratech Ltd, an infrastructure developer, has already set up 2 x 600 MW thermal power plants using imported coal. Unit 1 has been commissioned and Unit 2 is ready for commissioning.

At present 600 MW generated by Unit 1 is supplied to Karnataka State through 220 KV lines and meets power shortage in the State.

“The Unit II with 600 MW capacity is ready for commissioning since January 15, 2011, and we are waiting for the nod from the State government for synchronisation,” Panduranga Rao, the CEO for UPCL (Udupi), Kondapalli Power Plant (Andhra Pradesh) and Aban Power Plant (Tamil Nadu).

Reliable sources said that though the authorities concerned gave its nod for synchronisation, the Energy Department referred the case to Central Power Research
Institute (CPRI) for a decision, as the UPCL will have to reduce the power production while synchronisation as the existing power lines cannot carry more than 600 MW power.

Power lines not ready

If the government allows synchronisation, the UPCL will be ready within a month to commission the Unit II. But KPTCL is not ready with power lines.

“As against the required 400 kva line, as agreed in the PPA with the company, the KPTCL has set up only a 200 kva power line at Kemar near Karkala in Dakshina Kannada district.

This is capable of evacuating only 200 MW of power from the plant to the main national grid at Shanthigram in Hassan,” a senior company official said.

Interestingly, the government was supposed to set up the 400 kva line by April 2010. At the current pace of work, it may take few more months, said a source, adding that of the 527 towers between UPCL plant and Hassan 180 km away, foundations have been laid to 379 towers while towers have been errected in 335 locations.

Udupi District-in-Charge Minister Dr V S Acharya said that the UPCL has been given clearance by the Forest Department and once the work is completed, the full power generated by the UPCL (1200 MW) could be utilised. Foundations are yet to be laid at 148 locations.

Till the 400 kva line is set up, it will not be possible for the UPCL to evacuate power completely, though there is power, especially at a time when the State is reeling under power shortage, that too, at a cheapest rate of approximately Rs 3.60 per unit.

At present, the State purchases power at a price between Rs 9 and Rs 12 per unit.

No Escrow accounts yet

Another interesting aspect is that though UPCL started commercial operations about 4 months ago, supplying 12 million units to the State grid, the principal buyers, all Escoms except Bescom, have not opened an Escrow account. An escrow is an arrangement where a third-party receives and disburses money for parties, with the timing dependent on the performance by the parties  agreed-upon.

The account will be triggered into operation if the principal buyer fails to replenish the Letter of Credit (LC) or the tariff invoice amount exceeds the LC amount. The LC is issued for an amount equal to 45 days projected payment.

 

Power projects saga in coastal region

The saga of power projects in coastal region began in 1987 when Karnataka Power Corporation Limited (KPCL) proposed to put up a 2X210 MW coal based thermal power plant at Nandikur in Udupi district.

Though KPCL had carried all preliminary work like survey and environment studies and obtained necessary clearances from statutory agencies, they could not go ahead due to local opposition.

In 1989, National Thermal Power Corporation (NTPC) proposed to put up 2X210 MW capacity power plant at the same place. In fact, it acquired 2,500 acres of land. Though NTPC too obtained necessary clearances, it could not take off due to several writ petitions in High Court and disintegration of Russia.

After NTPC gave up its project, the State government invited several private parties to invest in power project. As a result, in 1995, Congentrix Inc of USA proposed to set up 1,000 MW coal based power plant in same place. However, writ petitions filed against the firm forced it to withdraw.

In the year 2000, Congentrix handed over its share to China Light Power (CLP) and thereafter CLP had venture with Tata Group to set up 1,000 MW. But this project too failed due to non-availability of payment security mechanism required by the financial institutions/bankers.

Later, Suzlon got permission to start windmill, but this project too did not materialise and it sold its land to many small firms.

On the other hand, Nagarjuna Power Corporation Limited (NPCL) got the clearances for power project from the State government in 1995-96. The State government issued land acquisition notification to KIADB in 1995-98 and necessary clearances required for the thermal power plant project were obtained in 1996-97.

In 1999, some of land owners challenged the aquisition of land before High Court which was dismissed later. In December 2005, the power purchase agreement with UPCL was approved by the State goverrnment.

The project went on critical by synchronisation with the grid generating 55 MW power at 5.41 am on June 2, 2010, which co-incidentally was the first day of Global Investors Meet organised by Government of Karnataka. By June end, it started generating 600 MW.

The Unit II of UPCL was ready on January 15, 2011. But now, its awaiting nod for synchronisation and commissioning of unit II of the plant, following which the UPCL would be able to produce 1,200 MW power, thus covering the 50 per cent of the State’s requirement.

Courtesy_ DH News