Editorial October 2018

The notification of the new emission standards in December 2015 was a key development for the coal-based power generation industry. To recall, for the first time, apart from primary pollutants like PM and also secondary pollutants like SOx, NOx and mercury, the standards were differentiated on the basis on vintage and the size of the plant. The emission standards, as per the Central Pollution Control Board, were important as they could help achieve a reduction of 48 per cent in SOx and NOx, 40 per cent in PM, and 60 per cent in mercury.

Geographically, the operational power plants that needed to comply with the norms were largely in the key states of Maharashtra, Uttar Pradesh, Chhattisgarh and Gujarat. Further, around 66 GW of under-construction plants were identified for compliance. And some 22 GW of capacity was identified to be retired, which included plants that do not have space to install pollution control equipment.

While the norms had a deadline of December 2017, the power ministry had sought an extension to 2022 for implementing the same. However, so far, compliance is still at an early stage. The country’s largest power generator, NTPC Limited, has taken the lead, with its first FGD system now operational and work in progress at plants with 17 GW of capacity. A few other state and private utilities have also made some moves to issue tenders.

The initial uncertainties associated with the recovery of huge investments in emission control systems has now been settled with the government notifying that the additional cost is to be allowed as a pass-through to the off-takers under change in law.

That said, new concerns have emerged with regard to financing these investments as banks are reluctant to lend to the already stressed power companies. In fact, power companies have sought the central government’s intervention for financial assistance.

Further, the timelines for implementing the norms are being litigated in courts. Earlier this year, in July, the Supreme Court had pulled up the centre and the Ministry of Power for extending till 2022 the deadline for thermal power plants to adhere to the emission norms, in a matter pertaining to the air quality in Delhi. The court also recently directed NTPC and Damodar Valley Corporation to comply with the norms at 57 plants by December 2021.

In this month’s Infocus section on “Emission Control”, we take stock of the key developments in this space. In this issue, we also bring you the highlights of the Power Line Summit 2018, which was held recently in New Delhi.

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