All is not lost in stressed power projects; Railways, PPAs, EVs to be growth drivers: Assocham

As many as 24 power projects with 41.81 GW capacity may be under a severe financial stress, but the troubled sector still holds hope in growth drivers including higher demand from the Railways, proposed law to enforce power purchase agreements (PPAs) on the discoms, increasing focus on electric vehicles and reaching electricity to all un-electrified villages, an Assocham study has noted.

“Our assessment shows that all is not that bad, as is made out by stock analysts or the bankers getting panicky, having financed the big projects. There are good prospects, provided we are able to enforce PPAs and work on the plans already finalised,” said Assocham Secretary General D S Rawat.
The government proposes to amend the law-making obligation under PPA, statutorily binding all discoms to have PPAs to cover 100 per cent requirement.

Similarly, Indian Railways have taken great initiative for electrification. About 50 per cent of the Railways is presently electrified. It is expected that the railway load is expected to exceed 3,000 MW by 2021-22 from a current traction load of 2,000 MW thus opening a potential of demand creation.

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