Pitfalls of surplus power in Punjab

Punjab is going to be first state in the country to become power surplus after the commissioning of all the units of Talwandi Sabo and Rajpura thermal plant.

 

The first unit of Talwandi Sabo thermal was synchronized with grid on December 31 and first unit of Rajpura thermal is likely to be synchronized with grid in next few days. The remaining units of two thermal plants will be commissioned by August.

Punjab State Power Corporation Limited (PSPCL) in its tariff petition has mentioned that the thermal plants at Talwandi Sabo, Rajpura and Goindwal Sahib will be generating 13444 million units (MU) and it intends to surrender 7987 MU from these private sector thermal plants.

 

The tariff petition also indicates that PSPCL intends to surrender a total of 12994 MU of power. The proposed surrender of surplus power will from central sector projects and private generating thermal plants established in state in order of merit their fixed charges. However, the generation from private sector thermal plants in private sector will be on higher side and the surplus power to be surrendered will be surrendered will be around15000 MU.

 

The state sector thermal plant units are likely to become unintended victim of surplus power in Punjab as these units will be backed down to pave the way for private sector generation as and when the power demand in the state takes a dip.

 

PSPCL in its ARR has not proposed any surrender of power from state run thermal plants at Ropar, Lehra Mohabatt and Bhatinda. If one looks into the track record of PSPCL for the current financial year it is the state sector thermal plant units which were ordered to be shut down on no demand to pave the way for power purchases made by PSPCL. The priority order of PSPCL for closing thermal units is Bhatinda units followed by Ropar and Lehra Mohabatt thermal units.

 

As per tariff petition Ropar thermal plant will net generation will be 8693 MU while for Lehra Mohabatt thermal plant and Bhatinda thermal plant net generation is likely to be 6272 MU and 2823MU respectively.

 

PSPCL which has been making efforts to sell surplus power to southern states may not be able to do so sell surplus power to southern states as the average rate of power of Punjab would be around Rs. 3.50 and with wheeling charges the cost of selling power may be above Rs. 4.20 Per unit. It may be mentioned that power in southern states will be available at cheaper rates from power exchanges in next financial year as southern grid will function in tandem with other grids in next few months.

Tariff increase

 

Further in case of increase of surrendered surplus power from 12994 MU to 15000 MU the fixed charges to be paid by PSPCL would increase from 1706 crore to 1961 crore. The burden on consumers on account of fixed charges will increase from 44 paise per unit to 50 paise per unit.

Power export to Pakistan

 

The only alternative available is to export power to Pakistan where power tariff is more than Rs. 7 per unit. CEA and Power Grid officials claim that power can be traded through HVDC coupling. The project would require 45 Kms. of 220 KV transmission line on both sides. Initially 500 MW is likely to be exported which can be increased to 2000 MW subsequently.