Gas-based power plants await revival: Ind-Ra

India Ratings & Research reports that the credit profile of private sector owned GBPPs has deteriorated and several such projects have already applied for debt restructuring.

The plant load factor (PLF) of gas-based power plants (GBPPs) is likely to decline further in FY18, states a report published by says India Ratings and Research (Ind-Ra).

According to the research agency, the expectation is based on the:
• Closure of the scheme for the revival of GBPPs by way of government subsidy through the power system development fund,
• Higher variable cost of generation than that for coal-based power plants and other alternatives
• Availability of lower-cost power on the power exchanges, and
• No improvement in the domestic gas production.

The Indian government had announced a subsidy scheme in FY16 to revive GBPPs, leading to PLFs of GBPPs marginally improving to 23 per cent in FY17 from a low of 21 per cent in FY15. The subsidy scheme added only 2 per cent-3 per cent to PLFs over FY16-FY17 compared to the FY15 PLF. The implementation of the scheme led to the additional generation of about 15 billion kWh in FY16 and FY17, which is below 1 per cent of the total electricity generation.

Advertising