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Business News/ Companies / News/  ‘I am a non-executive director on PFS board’
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‘I am a non-executive director on PFS board’

PTC India's CMD Rajib Kumar Mishra spoke about PTC’s power trading operations, including the power purchase agreement with Nepal Electricity Authority for importing 300 MW of electricity.

PTC India's CMD Rajib Kumar MishraPremium
PTC India's CMD Rajib Kumar Mishra

New Delhi: After markets regulator, Securities and Exchange Board of India (Sebi), expressed concerns over allegations of corporate misgovernance at PTC India Financial Services (PFS), the chairman and managing director of parent PTC India Rajib Kumar Mishra said he is just a nominee director on the PFS board, indicating that he does not have the authority to oversee day-to-day affairs of the company.

In May, Sebi sent notices to Mishra and PFS managing director and chief executive Pawan Singh, accusing Mishra of interfering with the functioning of independent directors. In the interview, Mishra spoke about PTC’s power trading operations, including the power purchase agreement (PPA) with Nepal Electricity Authority for importing 300 MW of electricity. In its bid to diversify operation, the firm has floated a tender on bundling of renewable energy capacity for round-the-clock (RTC) power supply, he added. Edited Excerpts:

Sebi has sent notices to you and Pawan Singh over alleged corporate misgovernance at PFS. What has been your response to the notice, and the allegations?

I am a nominee director, non-executive chairman, on the PFS Board. I have no delegated power by the PFS board to conduct day-to-day functions. Companies Act and other regulatory guidelines also do not provide a nominee director, or someone in a non-executive post, the right to carry out day-to-day activities. My role was just to chair the board meeting but didn’t have any authority. The KMPs (key managerial professional) and MD has the authority for administrative decisions. In fact, I facilitated the board to become functional.

What are the recent developments at PTC in terms of cross-border trade?

We have recently signed a PPA for 300 MW with Nepal Electricity Authority to bring more power from Nepal via Bihar. Earlier Bihar used to export power, but for the first time we will import via transmission lines in Bihar. It should start this wet season but for that some conditions need to be met. We will decide on procurer as and when demand comes. It is a flexible arrangement. We are trying to find buyers. We may either sell to exchanges, or directly to the buyers. PTC has been trading with Bhutan, Nepal and Bangladesh for over two decades now. Apart from long-term procurement from Bhutan, we also assist Bhutan import during the lean hydro months through power exchanges. We also sell electricity to Bangladesh and we have had bi-directional trades with Nepal. We have been entering into arrangements to buy and sell from these geographies, and exploring investments in regional markets—makers, traders and power exchanges as and when they are functional.

Recently PTC signed two long-term agreements. Should we expect more such contracts?

Our objective with these agreements is to establish new business models in which PTC as a market maker takes risks as well as offers value-added solutions in the electricity trading segment. Our objective is to increasingly scale such models by leveraging domain expertise and market making capabilities. Currently, we are trying to create a portfolio that balances risks and rewards through a mix of long-term and spot market strategies, selling to commercial as well as industrial users, utilities and on power exchanges. PTC India’s signing of two long-term agreements signifies its commitment to expanding its presence in the market, and securing stable partnerships, besides offering innovative solutions to generating companies and buyers.

Moving forward, PTC will actively seek potential buyers who align with the firm’s strategic goals and operational requirements. Once potential buyers are identified, PTC India Ltd will start negotiations to establish long-term agreements, outlining the terms and conditions for capacity tie-ups. These agreements may include aspects such as energy supply terms, pricing mechanism, duration of agreements, and any other relevant contractual provisions. As PTC India continues to expand operations and strengthen its position in the market, it plans to scale up this kind of long-term trading.

What is the progress on your plans to diversify operations?

PTC has been a pioneer with many firsts to its name. It is the true test of a market maker. We were the first to offer short-term trade for renewable generation projects, the first to introduce open-access trades to institutional customers like the Railways, and the Airports Authority of India, among others. We are now diversifying into long-term procurement of renewable energy and assuming market risks. We are looking to bundle conventional energy with RE to offer RTC solutions. We are focused on creating a large portfolio of suppliers and procurers with diverse requirements. We inaugurated an innovation and data analytics lab, and believe it will help take informed decisions based on the data-driven insights by identifying patterns, trends, and opportunities that may not be apparent otherwise.

What has been the progress in your renewable energy operations?

We currently have a long-term contracted capacity of 1050 MW of RE that we well to designated buying utilities. Apart from that we are active traders in carbon attributes and renewable energy certificates (RECS) offering bilateral procurement and sale under the new REC Regulations. Similarly, we actively trade in E-certs on the power exchanges. Additionally, we trade in electricity from hydro power plants like Karcham Wangtoo, Teesta III and from hydro stations in Bhutan (Chukha, Kurichhu, Tala and Mangdechhu). We also participate in the RE segments of power exchanges like GDAM and GTAM.

Our recent Expression of Interest (EOI) to procure 1000 MW of renewable energy power had received an overwhelmingly positive response. We are increasingly focusing on providing solutions for participants in the renewable energy sector, both on the supply and demand side. Additionally, we are actively involved in structuring solutions for virtual contracts and acting as virtual power plants. As the adoption of variable renewable energy (VRE) continues to grow, we are developing solutions for round-the-clock (RTC) power offerings by integrating thermal generation and/or storage solutions.

PTC India is also deeply engaged in the evolving value chain of battery energy storage systems and green hydrogen. Therefore, a significant focus of our company is to build the necessary capabilities to capitalize on these opportunities when they arise. Each of these measures presents significant opportunities for PTC India, and we are diligently working in these segments by crafting and offering tailored solutions and services to meet the evolving needs of the market.

Last year you had announced to set up a power trading company in Nepal. What is the development in that front?

A. Currently, the legislation that authorizes the government to involve the private sector in power trade is a work in progress. However, the government has consistently assured the private sector of its preparedness to issue power trading licenses. To address this, the government is in the process of passing a new electricity bill that will open the doors for private players to engage in Cross Border Electricity Trade. Currently, five Nepalese companies have applied for power trading licenses in Nepal. Among them, three companies have approached PTC for a joint venture stake. PTC is closely monitoring the situation in Nepal with increased in-person stakeholder interactions, anticipating the imminent passing of the electricity bill.

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Published: 10 Jul 2023, 11:17 PM IST
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