A 150% hike in prices of A and B grade coal of Coal India has put companies in a fix. However, State-run NTPC which is one of biggest power generation utility is confident that the price hike will not hurt its generation cost.
In an interview to CNBC-TV18, Arup Roy Choudhury, CMD of the company said, “We use E, F and others and not A and B. I don’t think there is going to be any effect on our generation of cost of the power.”
The bad news, however, is that international coal price hike may have a negative impact on NTPC. Choudhury explained that the company is blending about 15% of international coal into the system. “But that gives a rise to the cost of ultimate power of Rs 0.30 which sometimes creates a problem for our state electricity board to absorb the increase.”Going forward, he said that NTPC will reach power generation target of 4000MW-5000MW in FY12. The PSU is aiming to add 20,000 to 25,000 MWs in the next plan period. “But the only area of concern here is that of that about 6000 MW is from gas and this gas allocation has yet not come to us. The moment we get the gas allocation, we are absolutely on stream to attend that target,”Choudhury pointed out.
According to the Economic Survey 2010-11, growth in India’s power generation slowed to 4.5% between April and December from an expansion of 6.17% in the same period in the previous year, with the shortage of coal being one reason for this.
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