The State government, for the time being, has dropped its plan to sell the 1,650 MW Rayalaseema Thermal Power Plant (RTPP) to the NTPC, going by the recent communication sent by Energy Secretary N. Srikant to the A.P. State Power Employees’ Joint Action Committee.
Mr. Srikant, in his letter, said that the sale of RTPP had not been envisaged, which, a JAC leader said, was due to stiff resistance from the employees and some other reasons.
A four-member committee constituted by the government in January 2020 to look into the problems faced by the RTPP was learnt to have deliberated on the proposed acquisition of a majority stake in the RTPP by the NTPC, and had reportedly recommended to the government to not go ahead with it “with undue haste.”
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Two options
The committee had initially suggested that the RTPP could be made viable by reducing costs through rationalisation of coal supply and staff pattern, or by bringing in a Joint Venture (JV) partner, subject to the jurisdiction of the Central Electricity Regulatory Commission.
Reliable sources in the power sector said that the government had considered the sale of RTPP through the JV route on the grounds of high unit cost, large capital investments needed by it and coal problems, but chose to keep it on hold.
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It may be noted that a delegation of the NTPC had held deliberations with top officials of the State Energy Department and even visited the plant to obtain a first-hand account of its operational and financial performance.
In fact, the AP-Genco had reviewed the functioning of all thermal plants in the context of the mandate given by the Central government to improve efficiencies and gradually phase out the obsolete ones.