The Hindu : Railways, NTPC to set up power plant

Online edition of India's National Newspaper
Tuesday, Feb 19, 2002

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Railways, NTPC to set up power plant

By Our Special Correspondent

NEW DELHI FEB. 18. Fed up with the unresponsive attitude of State Electricity Boards (SEBs), which levied hefty rates for the power used for traction and non-traction purposes, the Railways have signed a Memorandum of Understanding (MoU) with the National Thermal Power Corporation Limited (NTPC) for setting up power projects.

Describing the MoU as "historic", the Railways Minister, Nitish Kumar, and the Power Minister, Suresh Prabhu, expressed the hope that such plants would benefit the nation by adding to the generation capacity.

Mr. Kumar said that the Railways spent Rs. 4,500 crore annually for electricity. The SEBs charged two to three times the rate at which they purchased power from Central agencies such as the NTPC; many even levied rates more than what they charged from industrial consumers.

In view of the unreasonably high tariff, the Union Cabinet had cleared a proposal by the Railways for drawing power from Central generating agencies. The Railways had been drawing power from the Auraiya NTPC plant since November 2000 for the Ghaziabad-Kanpur section. The arrangement had helped save Rs. 50 crore annually. Schemes had also been identified for availing direct power supply from the NTPC, the Nuclear Power Corporation and the Neyveli Lignite Corporation in other parts of the country.

The Railways Minister said it would take about five to six years for the commissioning of the power plant. The option of making it coal or gas-based was still open.

Terming the MoU as another step in the ongoing reforms in the power sector, Mr. Prabhu said the project report would be prepared by an expert committee and the site identified within a month. The MoU had been drawn up very quickly; the idea of a captive power plant for the Railways with a capacity of 2,000 MW had come up in his discussions with Mr. Kumar only about a month ago.

The Power Minister said the MoU also represented structural changes in the sector, where many distortions still existed. There were four components in power reforms — the cost had to go down, the quality had to improve, the sector has to be made commercially viable and power had to be readily available to the people. The Electricity Bill, 2001, which was being debated by the Standing Committee in Parliament, laid down that consumers would be able to buy power from whichever source they chose.

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