The short-term power market is up for an eventful journey in FY18-FY20, says India Ratings and Research (Ind-Ra). However, the market is inhibited by impediments such as transmission constraints, opaque processes on open access within most states and steep cross-subsidy charges. A power supply-demand mismatch and a hiatus in long-term power purchase by states provide immense opportunities to the merchant market.
Essar Power has delivered a strong operational performance in 2016-17, with its power generation moving up 49 per cent. Apart from generating more power, the company added 165 megawatt (MW) capacity to its portfolio by commissioning one unit each at its Paradip and Hazira plants. The generation increased 57 per cent year-on-year in the quarter ended March 31, 2017.
India has 275 GW of installed electricity generating capacity which is significantly higher than 140 GW of peak demand of electricity across the country. The energy generated through coal alone is higher than its peak demand. Despite the installed capacity exceeding power demand, some parts of the country face acute power shortages and more than 300 million people in India are still without access to power.
India has a unique indirect tax landscape for the infrastructure sector. While the sector enjoys a plethora of concessions and exemptions, the very nature of the contracting structure is troubled with a large amount of complexities, more so on the EPC contracting side.
As the Indian economy continues to grow from strength to strength, significant investments are being made to improve the much needed infrastructure of the construction and the mining industries, that are not far behind, with a high demand for fuel efficient and high productivity tippers.
With 28 years of experience in power transmission, distribution and generation, Dhananjay Ketkar is currently Chief Operating Officer at Egis India. An engineer and a post graduate in cost and management accounting, Ketkar started his career with NTPC in the power generation domain.