Telangana is ready to purchase power from troubled state-owned producer Ratnagiri Gas & Power (RGPPL) at Rs 5.50 per unit, according to a senior official in the company.
However, a congested transmission grid is preventing such sale of electricity and power ministry officials are trying to find a way to resolve the issue.
In mid-January, the finance ministry chaired a meeting along with RGPPL stakeholders to find a solution to the company’s long-standing dues of around Rs 8,500 crore.
During the meeting, RGPPL officials agreed to run the 1967 MW plant at 40% plant load factor (PLF) — a measure of efficiency of a power plant.
GAIL, one of the promoters of the Maharashtra-based company and which also runs the plant’s re-gassification unit situated alongside the plant, would supply re-gassified liquefied natural gas (RLNG) at $10/mmbtu.
RGPPL has signed a power purchase agreement with Maharashtra and so the state government has the first right of refusal before power can be sold to the southern state, according to the official.
“Currently, the average power purchase cost is Rs 3.65 per unit. However, the cost will jump after April, during the high temperatures of summer. Maharashtra may be interested in buying RGPPL power then,” the official said.
RGPPL, which uploaded its fiscal 2014 financial statements to the MCA database on January 20, stated that its FY14 net sales fell 56% to Rs 965.49 crore. This includes re-gassification income of Rs 84.39 crore. Net loss widened to Rs 1,486.47 crore from Rs 375.33 crore in FY13.
The company raised bills for Rs 1,222.83 crore for fixed charges to beneficiaries, primarily Maharashtra State Electricity Distribution Co, which is currently being contested in the Appellate Tribunal for Electricity.
The power plant generated 1506 MUs in FY14. “The company lost generation of 3780 MUs due to shortage in supply of domestic gas and 9275 MUs due to non-availability of schedule on domestic gas and RLNG,” the director’s report for the fiscal says.
The government had allocated 7.6 mmscmd of gas from Reliance Industries’ KG-D6 block and 0.9 mmscmd from ONGC’s marginal gas fields to RGPPL’s plant located in the western coastal town of Dabhol in Maharashtra. However, since September 2011, there has been a continuous decline in supply of domestic gas from KG-D6 and since March 1, 2013, the gas supply has stopped completely. The plant had a PLF of 8.74% in FY14.
“As a result, RGPPL could achieve an annual plant availability factor of 60.56% (13.8% on domestic gas, 46.76% on RLNG) during 2013-14 against required normative annual plant availability of 80% to recover full annual fixed cost,” the report said. The company has been rated ‘D’ by credit ratings firm CARE due to its financial position.
