Several states face power shortage as Adanis, Tatas shut some units at Mundra

NEW DELHI: Gujarat, Maharashtra, Madhya Pradesh, Haryana, Rajasthan and some other states may face power shortages as about 7,500 mw of generation is lost because of coal shortages, technical snag and payment defaults by a state.
Tata Power and Adani Power have partially shut generation at their Mundra projects on the west coast. Some units of NTPC, Maharashtra’s MahaGenco, Lanco and Indiabulls too have reportedly stopped power production due to coal shortages. As many other power producers have shut down plants for routine maintenance anticipating weak demand during the monsoon season, this development may aggravate the situation further for some states.

Together, Tata Power and Adani Power cut about 4,500 mw of generation for various reasons. The development comes also after the Supreme Court stayed a tribunal’s interim order that had allowed the nation’s top two private power-sector producers to claim compensation from these states for higher coal prices.

Tata Power has stopped power generation at two of its five 800 mw units, reducing 1,600 mw of supplies to the five states.

A Tata Power spokesperson told ET that one of the units was already shut due to issues related to boiler, while another unit went off Wednesday afternoon because of a technical snag. This has nothing to do with company’s demand for higher tariff to cover its costs, the spokesperson added.

An official at one of the discoms said it was preparing to start its natural-gas-fired plants to ensure uninterrupted power supplies in case the power producers reduce their generation further. “We are surprised with the drop in generation simultaneously by both Tata Power and Adani Power that have been seeking higher tariff,” the official said.

An Adani Power executive couldn’t be reached for comment on Wednesday. It has 4,620 mw installed capacity at Mundra.

While Adani Power has shut three 330 mw units on coal shortage, “three 660 mw units have been closed down reportedly on account of payment default of Haryana utilities,” read a note from Power System Operation Corp, a unit of state-run transmission network operator Power Grid Corp, on Wednesday evening. .

According to the note, power stations at Bhusawal, Khaparkheda, Parli and Vindhyachal have reported a generation loss of about 3,150 mw.

Both Tata Power and Adani Power bank of imported fuel, which became expensive after the Indonesian government changed coal price policies in 2011. Fearing higher generation costs, Tata Power and Adani Power approached the Central Electricity Regulatory Commission that allowed them to recover their higher costs partially. However, the state utilities opposed the move before the Appellate Tribunal for Electricity, but it ordered them to pay compensatory tariff for the past few months. However, the Supreme Court stayed the tribunal’s interim order and directed it to continue the hearing.