DNA EXCLUSIVE: Maharashtra to soon start importing 2MT coal to meet demand

After almost three years of ban, Maharashtra will begin import of coal initially with 2 million tonnes to meet the rising power demand. The state expects an investment of Rs 20,000 crore in the generation including renewable and thermal, transmission and distribution till 2023-24. In an exclusive interview with DNA, state Energy Secretary Arvind Singh explains government's strategy to maintain Maharashtra's load shedding free status. Edited excerpts:

What steps are being taken to improve coal supply?

After three years of ban, the state will import two million tonnes to boost generation for meeting rising demand especially during April-May 2019. This will be in addition to domestic coal. Bidders from Mumbai, Chennai and Adani Power have already emerged the lowest ones and they are expected to soon commence coal import from Indonesia. The contract will be for one year. Most of the imported coal will be used at Koradi, Bhusawal and Chandrapur power plants as they need good quality coal.

Has the state managed to restore coal supplies, especially from domestic sources?

It is true that due to mismatch on coal supply there was a problem in the beginning of October. For one week the state distribution company (MahaVitaran) had shed 500 to 750 mw load. However, due to improved coal supplies and dip in the power demand the situation was improved. The state was receiving almost 18 to 20 rakes of coal per day from coal companies, but now there are 28 to 30 rakes which is much better than the last year's 24 to 25 rakes.

The state-run MahaGenco's generation is about 6,500 mw which may go up to 7,520 mw if the state gets more coal. Current coal supplies are adequate to meet the demand till February. However, demand will go up in the April-May (summer) by another 1,000 to 2,000 mw compared to the last summer's peak of 24,000 mw.

What is the state's investment plan in generation, transmission and distribution?

There has been an investment of Rs 11,000 crore since 2014 in power sector with the help of central and state funds. The state expects investment of another Rs 20,000 crore in thermal and renewable capacity addition and strengthening of transmission and distribution networks up to 2023-24. The state, however, does not see private sector investment in greenfield projects due to lack of appetite following severe financial issues.

MahaGenco has added 3,200 mw in last four years comprising Koradi (3x660 mw), Chandrapur (2x500 mw) and Bhusawal (1x500 mw). This apart, MahaGenco has placed order for 1x660 mw supercritical power plant at Bhusawal which will come up by 2022. Feasibility studies are being done for the development of pit head coal based power plants at Umred (1x800 mw) and Chandrapur (1x660 mw). MahaGenco expects to get all clearance in a year and then start bidding.

As far as the private sector is concerned, they may invest in the taking over of some of the stressed power projects with total capacity of 5,000 mw. This will be possible ones some of these projects go to NCLT and put to bidding.

In renewable segment, the largest amount of bids have come out in last one year in Maharashtra for projects with total generation capacity of 4,000 mw. These bids are from MahaGenco and MadhaVitaran and also from private players including Tata Power and Adani Power. Maharashtra will see a significant capacity addition in solar in next two to three years. Besides, the state is aggressively implementing the Chief Minister's Solar Agriculture Feeder Scheme and the solar parks. The MahaVitaran tried to do distributed solar projects on its sub station vacant lands.

In the distribution sector, the state has added infrastructure with the help of central funding under the Integrated Power Development Scheme, Deen Dayal Upadhyaya Gram Jyoti Yojana and Saubhagya scheme. Through state spending MahaVitaran has connected 4.5 lakh farmers to grid.

On transmission side infrastructure addition is going on at the companies level. KFW sponsored green energy corridor programme is underway for evacuation of green energy.

What steps are being taken by MahaVitaran to recover mounting arrears?

Arrears are a big problem. MahaVitaran has 2.4 crore consumers out of which 2 crore are paying their electricity arrears in time and we are thankful to them. MahaVitaran's collection efficiency from these consumers is over 99 per cent.

The problem is with 40 lakh consumers who are in the agriculture sector and their dues are rising, especially in the last few years because of drought conditions. The total arrears from farmers are in excess of Rs 25,000 crore of which principal amount is about Rs 19,000 crore. Due to drought conditions, the government has asked MahaVitaran not to take coercive steps for recovery.

Another area of concern is dues from local bodies such as gram panchayats and urban civic bodies on account of electricity bills towards street lights and water supply schemes. Total arrears are nearly Rs 4,000 crore.

However, there is some relief as the state cabinet has given its approval to recover 50 per cent of arrears from the 14th Finance Commission money which comes to local and civic bodies. That has given the MahaVitaran some relief and the money has started coming in. It has already received Rs 450 crore as first instalment from rural and urban development departments.