Hinduja to Fire Up Vizag Plant

Hinduja National Power Corporation Ltd (HNPCL), a major player in Andhra Pradesh’s power sector, is determined to operate its Vizag power plant at full capacity despite facing regulatory and operational hurdles. The 1,040-MW coal-based plant in Visakhapatnam, which had been inactive from July 2020 to March 2022, resumed operations following a Supreme Court ruling but is currently underutilized due to unresolved issues with the Andhra Pradesh Electricity Regulatory Commission (APERC).

The Supreme Court's directive led to the approval of the Power Purchase Agreement and project cost for Hinduja Power, but discrepancies in "key cost events" and project execution are now under review by the Appellate Tribunal for Electricity (APTEL). This has contributed to the plant operating below its optimal capacity, affecting investor confidence.

Despite rumors of potential withdrawal from the project, informed sources assert that Hinduja Group remains committed to its power sector venture, citing significant investments and strategic importance. Both Hinduja Power and Thermal Powertech, key independent producers in the state, are operating at 60 to 80 percent capacity.

Andhra Pradesh faces challenges with high discom receivables, totaling ₹52,000 crore. The delay in payments to generation companies (gencos) hampers their ability to manage operational costs and affects power generation. Timely payments from discoms are crucial for avoiding reliance on costly short-term power markets.

The resolution of these issues, and improved financial flows to power suppliers, are essential for ensuring stable power supply and optimizing plant performance.

News by Rahul Yelligetti