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Monday, October 25, 2010

India - 'We want to buy power plants abroad'


Arup Roy Choudhury became the youngest public sector CEO when he took charge of NBCC in 2001. After turning the sick construction company into a `Mini-Ratna', he took over the reins of NTPC in August. In an exclusive interview with Sanjay Dutta , he talks about taking India's largest generation utility to the next level by acquiring power plants abroad with fuel linkages, going nuclear within three years, cutting costs and a greener power basket.
 
Excerpts: What is your mantra for NTPC? To become the largest and the best worldwide. We are already best in capacity utilisation. But we are not the best globally. We are Number 2, 3 in some aspect or the other. With just 700 unit per capita consumption, the country gives enough possibility for growth and be the best
 
.Secondly, we have to be more professional in costing and design. We must have the best of both. You'll find us competitive against private sector in the tariff-based (bidding) regime. How do you do this? Let's say what are the two basic components of competitiveness that we are looking at. One is the engineering department. We have the biggest, the oldest engineering department.
 
We have to look at more efficient engineering rather than re-engineering. There has been technological developments. With change in time, we have to see whether that can reduce our costs and make for more efficient designs. A team is already on the job.Two, how do we reduce cost of fuel, as a mix (of fuel), even if it is imported. We are now importing coal through STC and MMTC. But we hope to do it ourselves. That should make it more cost-effective.
 
There is also another thinking. Running power plants abroad with fuel linkages. Things are working in reverse today. Western economies are not doing well. We are. Why can't NTPC buy it (power plant) in Europe or Australia with good coal linkage. Ownership in mines abroad too are a possibility. Fuel is the most important issue for us. Besides, we are a thermal company today; about 80% of our capacity is thermal. We have to bring it down to 72% by 2032. We want to do solar, wind and nuclear. 
 
Have you identified plants abroad for acquisition? It is early to talk about it. But certainly there is a vision. We are looking at all options. How is your nuclear plan progressing? We will go with NPCIL ( Nuclear Power Corporation of India Ltd) as of now. Two possible projects have been identified. I can only share that the possible sites are in Haryana and MP. One of these we will do quickly, maybe 2013-14. It may be 2 x 700 mw.
 
Is there a rethink on hydel foray after the setback in the Loharinag Pala project? There is a rethink but not in terms of not doing it anymore. Rethinking is about strategy. How do we avoid a situation where we get surprises. Loharinag Pala was a surprise. Financially it does not affect us since the government has committed to compensate the money spent in the project. But it does affect us that we had spent so much time and energy on the project and then had to scrap it. We don't want to get into such a situation again.
 
What about overseas projects? Sri Lanka project is waiting for approval from their side. It takes time. Bangladesh is getting ready. Sites have been identified in Chittagong and Khulna. It will most likely be Khulna. Various reports concerning the project are underway. Coal transportation has been a major bugbear for NTPC.
 
How do you solve it? We are mostly dependent on the railways. They have been very positive. We are also going to soon use barges to transport coal to plants like Farakka. We have finalised the plan with the inland waterways authorities. The process has begun. Read more: 'We want to buy power plants abroad' - The Times of India
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