BREATHER FOR PSPCL
RELIEF Corporation will save ₹400 crore per year for next 20 years, the period for which it has PPA with private plants
Cash-strapped PSPCL has got a major relief as the Union government has done away with ‘washed coal’ condition for power plants.
PATIALA : Cash-strapped Punjab State Power Corporation Ltd. (PSPCL) has got a major relief as the Union government has done away with ‘washed coal’ condition for power plants.
With this, the PSPCL will save at least ₹400 crore per annum, besides getting a breather in a contempt petition filed by private thermal plants, seeking ₹2,800crore coal washing charges. It will also bring down the powergeneration cost in Punjab.
Till now, it was mandatory to use washed coal to reduce the ash content and private plants were demanding washing charges from the PSPCL.
Private power plants and PSPCL were caught in a legal battle over coal washing charges. After losing the case in the Supreme Court, the PSPCL were to bear ₹1,790 crore against coal washing charges for the period between 2012 and 2019 (October), along with the future annual burden of ₹400 crore. However, private thermal plants were demanding ₹2,800 crore.
To make for the burden of ₹1,790 crore, the Punjab State Electricity Regulatory Commission (PSERC) in first week of January this year allowed a 35 paise per unit surcharge on power consumers.
The Supreme Court had directed the PSPCL to pay ₹2,800 crore to Larsen & Toubro (L&T) in lieu of coal washing and transportation costs. L&T runs Nabha Power Limited (NPL), Rajpura, and Talwandi Sabo Power Plant under a power purchase agreement with the PSPCL.
The overall impact of the judgment would have been ₹8,000 crore in next 20 years, the remaining time period of PSPCL’s power purchase agreement with L&T, which the PSPCL will now save.
Power corporation CMD Baldev Singh Sran said the Union environment ministry’s step will prove most beneficial for Punjab. “Doing away with coal washing will help us save ₹400 crore per year. It will ultimately reduce power production cost and benefit consumers accordingly,” said Sran, adding “now the legal battle over coal washing charges has become infructuous. It’s a major relief for PSPCL”.