Arup Roy Choudhury, Chairman and Managing Director, National Thermal Power Corporation (NTPC) shares his views on the company´s plans for doubling its current installed capacity, its capex plan for this fiscal, the Corporate Plan-2032, and CSR activities.
How much of power does NTPC generate from all sources of energy? What is under execution currently? Sir, you had said that NTPC will double its current installed capacity to 90,000 MW in the next ten years. How will you go about it? Can you explain?
With an installed capacity of 44,598 MW through 17 coal-based, seven gas-based, eight solar renewable, one hydro, and seven joint venture power stations; NTPC contributes more than 25 per cent of the electricity in the country, with about 18 per cent of India´s installed capacity. Currently, we have over 24,000 MW capacity under construction, expecting it to start generating in the next four to five years. Feasibility Report (FR) has been approved for around 20,000 MW. FR preparation is underway for another 15,000 MW capacity, covering diverse fuels, i.e., coal, hydro, renewable, and nuclear energy. All these add up to 90,000 MW, which is achievable in the next ten years.
What is the capex plan for the year 2015?
NTPC exceeded the capex of Rs 22,883 crore (102 per cent) for FY2014-15. For the current fiscal year, it is Rs 23,000 crore.
There is a lot of concern about the power sector. How far is NTPC impacted?
The new government´s vision of providing power 24X7 to each household will determine the pace and nature of the power sector development, thus providing the thrust to economic growth.
India currently has one of the lowest annual per capita power consumptions of about 920 kwh. It is also the lowest among the BRICS nations. I am confident that a high level growth, backed by the push for ´Make in India´ programme will require rapid capacity addition. Demand, supply, and consumption trends will be the key to the growth of the sector.
While there is a peak and energy deficit, there is also a situation where large amount of power is not getting dispatched. On one hand, there is a need to enhance capacity and on the other, there is an equally compelling need to optimise the utilisation of existing capacities with the help of measures like open access, separating distribution companies from wire owners, reduction of AT&C losses, etc. Improvement in the financial health of state utilities will hold the key to power sector development as these are the entities which buy power from the generation companies.
The rate of capacity addition has already risen from four GW per annum during the 9th and 10th Five-Year plans to over 10 GW during the 11th plan period. This is expected to accelerate further to over 20 GW during the 12th plan and beyond, considering both conventional and renewable sources. This growth scenario ensures ample room for both the public and private players to grow, complementing each other in the endeavour of economic development and nation building.
NTPC generates maximum power from coal. Do you have plans to include solar energy in its total installed capacity in the coming years? Is there any current solar project that is under construction?
NTPC has already commissioned eight solar power projects aggregating 110 MW. Fifty per cent of 110 MW, i.e., 55 MW of solar plants are located at exist¡ing thermal power stations, namely, Dadri, Faridabad, Ramagundam, Unchahar, Talcher, and Singrauli. The balance commissioned solar plants include the 5 MW plant at Port Blair (Andaman & Nicobar Islands) and 50 MW plant at Rajgarh (Madhya Pradesh). NTPC has now submitted its green commitment to the Government of India for developing 10,000 MW of renewable energy projects during 2014-19.
The GOI and the Ministry of New and Renewable Energy (MNRE) have appointed NTPC to act as a nodal agency for implementing 15,000 MW solar power projects through IPPs under GOI/MNRE´s National Solar Mission Phase II Batch II in three tranches of 3000 MW (2014-17), 5000 MW (2015-18) & 7000 MW (2016-19).
Does NTPC face payment defaults, particularly by the distribution companies?
NTPC has no pending payment from any of its customers. We have 100 per cent realisation of dues till date.
What opportunities do you see for the coal sector, especially after the allotment of new coal mines? How much coal does NTPC import in a year?
A number of initiatives have been taken to improve the coal supply in the country. Putting power, coal, and renewable ministries under one minister has been one big step, which has ensured an integrated approach towards fuel management for the power sector. As a power generator, we are seeing much better response from the coal companies.
The coal production target for Coal India Ltd (CIL) has been envisaged to be increased to one billion tonne mark by 2019-20. Steps have been taken to optimise coal transportation by rationalising the coal linkages, which shall lead to savings in freight costs. With the introduction of third party sampling, quality of coal is expected to improve.
The government has moved rapidly to clean up the issues in the coal sector after the judgement of the Supreme Court and the transparent auction of coal mines shall ensure that the coal supplies to the sector shall be augmented with the participation of more players.
NTPC has taken many green initiatives recently. What are the plans of the company in the area of solar power generation?
NTPC, as per its corporate plan, envisages a capacity addition of 1,28,000 MW with a diversified fuel mix comprising 56 per cent coal, 16 per cent gas, 11 per cent nuclear, eight per cent hydro, and nine per cent renewable energy sources. NTPC has already commissioned eight solar power projects aggregating 110 MW. Presently, NTPC is developing world´s largest solar power project of 1000MW capacity at a single location by a single developer, in Anantapur district of Andhra Pradesh, in three phases.
Solar projects in Madhya Pradesh, Rajasthan, and Telangana are proposed in a phased manner. In Uttar Pradesh, Odisha & Pudduchery, discussions are in progress. They have shown interest in joining hands, and providing requisite land to NTPC for development of solar power projects.
NTPC has also decided to install rooftop solar power plants on all thermal power plant buildings of all upcoming NTPC thermal power projects. It is estimated that roughly one MW rooftop solar power plant can be installed at each station.
You were appointed as the youngest CMD of a PSU and have had a successful reign of NTPC. How would you look back at your tenure and what´s your aim for NTPC in the next 5 years?
When I joined NTPC, the company was considered to be under-performing in its primary role of capacity addition, which required to be augmented and our efforts for building capacity helped to bring back the confidence of our investors. The entire team-NTPC has risen to the occasion, and during the last four years has already added 12,000 MW, which is over one-fourth of its total installed capacity of more than 44,598 MW, built in over 38 years. NTPC has made the single largest thermal capacity addition in the country during the first two years of the 12th Plan period.
For the 12th Plan, over 7,000 MW capacity has already been added, and NTPC is well on course to achieve the plan target of 11,920 MW.
Further, PPAs of a total capacity of 1,05,000 MW have been signed, ensuring that there are enough projects for sustained growth. NTPC is well-poised to achieve its Corporate Plan-2032 target of reaching 1,28,000 MW by 2032.
A pioneering tripartite arrangement has been developed with Inland Waterways Authority of India and a private developer for transporting three MTPA of imported coal. Operation of the system has already commenced with arrival of barges of coal to Farakka station on 13th November 2013.
NTPC has also forayed into other segments of the power sector. It is now a big player in clean and green energy. Though sometimes painted as one of the biggest polluters in the country, NTPC not only meets all its environmental obligations to the nation but also gives good returns on the capital invested.
What is basic aim behind NTPC´s CSR activities? How does it empower the people?
Spread all over the country, the company´s projects evolve strategies to align CSR with core competencies. Most projects are in remote, underdeveloped locations, where basic amenities and social infrastructure are absent. The motto of NTPC CSR activities, therefore, has always been to raise the standard of living of the locals around the project areas. NTPC hence, focusses on quick improvementin the quality of life of the neighbourhood population by providing supports in infrastructure, education, and health. Experiences have shown that with a little support and sincere efforts, people come out of the morass of poverty, backwardness, and privation.
NTPC´s community development project activities in the neighbourhood of its project stations have been done in consultation with all stakeholders, after detailed need assessment and base line survey. The thrust areas are education, health, sanitation, drinking water, sports, vocational training, community infrastructure, etc. Our community development (CD) activities in focus areas of basic infrastructure development like sanitation, road, drinking water; primary education; community health; vocational training, etc. are based on specific local requirements, and guided by extensive need assessment surveys and consultation through various participative forums like Village Development Advisory Committee, Rehabilitation and Periphery Development Advisory Committee, Village Quality Circles, etc.
Committed socially since inception, NTPC has a comprehensive Resettlement & Rehabilitation (R&R) policy covering community development activities. CD activities in green field areas are initiated immediately when a project is conceived and thereafter, extensive peripheral development activities are taken up along with the project development. A separate CSR Community Development Policy covers a wide range of activities, starting from unit level to regional and national level, including implementation of key programmes through ´NTPC Foundation´. NTPC believes that business should add value to the community and the society on a sustainable basis through dedicated policies, institutional setup, and engagement process to promote inclusive growth.