As the Central government delayed allocation of gas, the 100 MW gas-based power station here stopped generation for the last four months affecting not only industries that depended on it but also agriculture on 6,600 acres. The fate of 250 employees working in the power station also hangs in balance.
While several power projects coming up in private sector in East Godavari district are able to get gas allocated expeditiously, the joint-sector power plant at Vijjeswaram is languishing for want of gas! Private power stations had to supply 80 per cent of their generation to Transco at fixed rate and sell only 20 per cent to other customers at market price. So the Central government is giving them priority. As Vijjeswaram supplied power only to its share holders, it is considered as a captive power plant. Consequently, the State is not able to utilise its installed capacity.
Vijjeswaram power plant created many records. It was the first power plant in South India established with private public participation in 1988 at the lowest cost of Rs. 1.4 crore per megawatt. The second unit of 172 MW was established in 1997 in a record time of 13 months. The station achieved a plant load factor (plf) of 93 per cent last year.
While public sector units like Transco, BHEL, hold 48 per cent equity, private industries like Andhra Sugars, Maha cement etc own 52 per cent and they share the power generated in proportion to their equity. The power station was highly successful as Gas Authority of India Limited (GAIL) supplied five lakh standard cubic meters of gas to the first unit and 8.2 lakh standard cubic meters to its second unit at a cost of 1.75 dollars per unit. It generated power at a very low price. But GAIL has later increased its gas price to 4.2 dollars a unit on a par with Reliance. Yet Vijjeswaram power station supplied gas at Rs. 2.60 a unit making its share holders happy (Transco supplied power to industries at Rs. 3.20 per unit). But it fell on bad days as gas supplies dwindled in the wells forcing GAIL to cut down supplies. It supplied only 8.5 lakh standard cubic meters of gas to Vijjeswaram now. Reliance came to its rescue by supplying five lakh cubic meters from May 2009. But Reliance stopped its supplies from this August for want of formal agreement forcing Vijjeswaram to shut down its 100 MW unit for the last four months. It is running only the second unit with gas supplied by GAIL now.
The first unit used 76 cusecs of water for cooling purposes and released the same into Godavari western main canal. Farmers used this water without any need for lift irrigation on 6,600 acres. As the first unit was closed, farmers are not able to raise crops.
