Hinduja National Power Corporation Limited (HNPCL), the power venture of the Hinduja Group, recently commissioned its first greenfield thermal project. The 1,040 MW coal-based power project in Andhra Pradesh, has, however, been in the works since 1995. Notwithstanding the long wait for the project, HNPCL is currently bullish on the power sector’s growth and is looking at investing close to $12 billion over the next few years to scale up its portfolio to 10,000 MW. In an interview with Power Line, the company’s managing director, Ashok Puri, talks about the new project, the company’s growth plans and the outlook for the sector…
Please tell us about HNPCL’s presence in the power sector and its growth journey till date?
The Hinduja Group considers the power sector as one of the growth areas in the country. Our vision is to create a generation capacity of 10,000 MW over the next few years at an investment of $12 billion, which will add to the government’s massive electrification drive.
Our presence in the Indian power sector dates back to the 1990s, the post-liberalisation period. We had committed to commission a 1,040 MW thermal power plant to meet the needs of the people in Andhra Pradesh as well as in the neighbouring regions, if any surplus remained. However, due to a few pending regulatory clearances, the project faced initial delays. Furthermore, in October 2014, Cyclone Hudhud impacted the seawater intake/outfall system, adding to the delay. However, the first unit began supplying power to the grid in January 2016. Currently, the 1,040 MW plant is fully operational. Today, Andhra Pradesh has become the first among the southern states to be power surplus.
The need for power is more than ever in India as industrialisation and electrification have raised the demand multifold. The Hinduja Group will relentlessly pursue its vision to create 10,000 MW capacity to fuel the nation’s dreams.
What are the highlights of the Vizag project? What are the arrangements for power offtake from the project?
The greenfield 2×520 thermal power station at Palavalasa near Visakhapatnam is fully operational. Bharat Heavy Electricals Limited (BHEL) was the main engineering, procurement, construction (EPC) contractor for the plant. The project has a mix of debt and equity, for which the State Bank of India (SBI)-led consortium of 15 banks has backed it as lenders. Mahanadi Coalfields is the sole provider of coal for the station. The power offtake from the project is fully tied-up. We have a power purchase agreement (PPA) for providing 100 per cent power to Andhra Pradesh.
What are HNPCL’s capacity addition targets for the next few years?
HNPCL is currently focusing on optimising operations at the existing 2×520 MW power station. We are assessing the possibilities for greenfield and brownfield expansion. However, it is still at the evaluation stage. As indicated earlier, the Hinduja Group is committed to commission a generation capacity of 10,000 MW over the next few years, for which we are currently undertaking due dilligence.
What is your outlook for the power sector and what role does HNPCL have in it?
The Hinduja Group believes that India will achieve balanced energy mix in the future. Today, the government is on a drive to electrify the entire country. The decision to hike Coal India’s production target to 1 billion tonnes followed by successful coal auctions and improved linkages is revolutionising the sector.
Over 10,000 villages have been electrified in just 12 months. This indicates the frantic pace at which the government is moving towards electrifying the whole nation. India’s need for power hinges on two factors – broad-based inclusive development and increasing industrialisation.
The launch of the Vidyut PRAVAH mobile app is a testimony to the transparency that the Ministry of Power is committed to. The Ujwal Discom Assurance Yojana is successfully solving financing problems that state discoms have faced traditionally. Solar, wind and natural gas are increasingly becoming a part of our energy mix. Amidst this revolution, HNPCL is committed to support the government’s drive to electrify every village in the country and touch every citizen’s life.