The Rajiv Gandhi Combined Cycle Power plant of the National Thermal Power Corporation at Kayamkulam has resumed power generation after a gap of six months after the Kerala State Electricity Board (KSEB) has given orders for electricity.
Power generation, which started on Tuesday, is based on daily orders being given by the board. Orders have been received till Friday and it is expected that demand from the KSEB may continue for a while as the power situation in the State remained grim.
The naphtha-based unit is generating 150 MW daily for the KSEB at Rs.7.27 a unit. The rates have been fixed on the basis of the price of naphtha. The naphtha stored at the unit is utilised. The stock will last for about 20 more days.
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About 20,000 kilolitres of naphtha was available at the unit. Each day’s production required about 900 kilolitres of the fuel, NTPC sources said.
If there is sustained demand from the KSEB, the NTPC would have to get fresh stock of naphtha. The market price of naphtha had come down in view of the reduced oil prices in the global market. It would reflect in the cost of production and electricity could be sold to the KSEB at lesser prices. Long-term orders for power generation would result in cost advantage and electricity could be given at Rs.6 a unit or even less.
The KSEB had not been sourcing power from the NTPC owing to higher production charges. The board has been sourcing power from other sources at lesser rates. Interestingly, the State government has to provide about Rs.20 crore a month to the unit irrespective of power generation, in order to honour a contract made at the time of installation of the plant at Kayamkulam.
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Alterations made
The NTPC has already made alterations in machinery to make use of natural gas in place of naphtha for power generation. Liquefied natural gas (LNG) is sought to be brought from the Petronet LNG terminal in Kochi. The KSEB has not entered into a power purchase agreement with the NTPC, apparently due to uncertainties over the prices of LNG as well as the cost of generation of electricity by making use of natural gas.
Plans for laying an undersea pipeline to transport LNG from Kochi to Kayamkulam have reached nowhere.
The net result has been the idling away of the Rs.1,300-crore plant having a capacity of 350 MW, for most part of the year.
KSEB has not been
sourcing power from NTPC owing to high costs
Power charges may come down owing to reduced price of naphtha