MahaGenco seeks nod for time, cost overruns

The Maharashtra State Power Generation Company (MahaGenco), which is currently struggling to operate its plants for want of coal, has sought an approval from the State Electricity Regulatory Commission (SERC) for time and cost overruns of its three projects.

These projects are - Koradi (3 units of 660 megawatt each), Chandrapur (500 mw x 2) and Parali (250 mw x1). The cost for Koradi project surged to Rs 14,881 crore against the budgeted Rs 13,848 crore, Chandrapur Rs 8,016 crore against Rs 6,853 crore and Parali Rs 2,345 crore against Rs 2,197 crore.

Koradi's three units have been completed in 75 months, 86 months and 91 months against the contracted period of 51 months, 57 months and 63 months. In case of Chandrapur, one unit was completed in 96 months against the contracted 40 months while another took a record 101 months against 40. Further, Parali unit was completed in 94 months against 33 months.

The per megawatt cost for Koradi was reported at Rs 7.51 crore, for Chandrapur Rs 8.01 crore and for Parali Rs 9.38 crore. The per megawatt cost for similar super critical 660 mw projects is in the range of Rs 5-6 crore.

A MahaGenco official told DNA Money, "Our petition is expected to come for hearing on Thursday at the SERC.''

However, various consumer bodies including the Thane Belapur Industries Association (TBIA) have strongly opposed MahaGenco's appeal saying that the delay on account time and cost overrun is enormous and the interest during construction at 33%, is too high.

TBIA representative Ashok Pendse said some of the comparable timelines include Tata Power's unit 8 of 250 mw that was completed in 31 months and Adani's 660 mw in 48 months.

"Loading of spares and civil works at initial stage itself should not be allowed. Similarly, employee cost escalation should be looked into. The fuel cost of the Parali unit is more than Rs 3 per unit which is so high that the state electricity distribution utility MahaVitaran won't be in a position to purchase it. Then the question arises why MahaViatran should have a power purchase agreement with MahaGenco for Parali unit at all?,'' Pendse said.