BackThree NHPC power stations shut in a blow to disinvestment plans
Power generation capacity of around 900 MW put offline at Uri-II, Parbati-III and Teesta Low Dam-III
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New Delhi: Three power stations of the state-run NHPC Ltd have been temporarily shut down due to electrical and construction faults, impacting a power generation capacity of around 900 MW and potentially dealing a blow to the centre’s plan to sell a part of its stake in the hydropower producer.
This capacity, large enough to meet the peak power demands of Jharkhand, has been put offline at Uri-II (240 MW) in Jammu and Kashmir (J&K), Parbati-III (520 MW) in Himachal Pradesh and Teesta Low Dam-III (132 MW) in West Bengal.
Uri-II was shut down in December after a fire in the transformer damaged the cables, Teesta Low Dam-III faced problems with its electrical equipment, and the Parbati project has been struggling to contain seepage in the tunnel.
The ₹ 2,300 crore Uri-II project, located in Baramulla district of J&K, was inaugurated by Prime Minister Narendra Modi on 4 July.
The shutdowns come amid government plans to sell a 11.36% stake in NHPC, expecting to raise more than ₹ 2,600 crore from the divestment.
“It is embarrassing that the three projects are not functioning due to issues related to electricals and construction at a time when the country wants electricity," said a person aware of the development requesting anonymity. “There are issues with these projects," said another person aware of the fiasco who also didn’t wish to be identified.
Queries emailed to spokespersons for NHPC and the power ministry remained unanswered.
NHPC has also been unable to fill the post of chairman and managing director (CMD), which has been vacant since January 2011.
The government’s record of failing to meet disinvestment targets casts doubts on the wisdom of relying on such one-time revenue streams for fiscal consolidation.
The Modi government in its first budget set a disinvestment target of ₹ 58,425 crore, including ₹ 15,000 crore from the sale of residual stakes in some state-owned firms in which the centre had sold its majority stake between 1999 and 2004. The cabinet panel on economic affairs in September approved stake sales in Coal India Ltd, Oil and Natural Gas Corp. Ltd and NHPC Ltd.
NHPC has told the power ministry that it may report a loss in the current fiscal year, Mint reported on 8 September. The failure to start the construction of the Lower Subansiri project in Arunachal Pradesh, delays in payments by the Jammu and Kashmir government, and a low tariff that does not cover construction costs will have a ₹ 988 crore impact on NHPC, it said in a 20 August communication to the ministry.
NHPC’s profits have fallen over the past two years from ₹ 2,771.77 crore in 2011-12 to ₹ 2,348.22 crore the next year and ₹ 978.79 crore in 2013-14.
Another cause for worry is the decreasing share of hydropower in the country’s energy mix. There have been concerns raised about the faltering hydropower generation in the country and delays in project execution.
India has a power generation capacity of 2,55,012.79 megawatts (MW), of which 16% or 40,798.76 MW is accounted for by hydro power.
Shares of NHPC fell 1.08% to ₹ 18.30 apiece on BSE on Wednesday as the exchange’s benchmark Sensex fell 0.29% to 26,908.82 points.
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