State-run NTPC, India’s biggest electricity producer, has shelved plans of acquiring stressed power assets in the private sector, and will instead help lenders to these debt-ridden power plants run them for a fee.
“For assets that are still under implementation, NTPC intends to assist banks complete construction of these projects and achieve commercial operations,” K Biswal, director of finance at NTPC, told source at the 7th Asian Mining Congress here on Wednesday.
“Earlier, NTPC was looking at taking over stressed assets from the private sector. However, now we have changed our strategy and would like of offer management services to these companies.”
The possibility that the valuation of these stressed assets may not be accurate may have shaped NTPC’s decision, as it does not want to be hauled up for an acquisition based on these numbers.
NTPC had decided to take over stressed assets a few years ago. However, it did not acquire any plant from the private sector, though a number of them were up for acquisition. It later decided to take over state-owned power companies’ assets that were not running well.
People in the know said NTPC has taken over a number of thermal and hydel power plants from other central sector companies as well as state-owned power stations.
The latest on NTPC’s list of acquisitions is the Chhabra Thermal Power Plant, which it took from the Rajasthan government. “The station includes a 1,000 mw unit that is running and another 1,320 mw capacity that is under construction,” said Biswal at the event organised by The Mining, Geological Metallurgical Institute of India. “We expect to complete the acquisition soon.”
An official had said on Tuesday that the acquisition could be completed in a month or two.
NTPC had signed a tripartite memorandum of understanding in January with Rajasthan Rajya Vidyut Utpadan Nigam and Rajasthan Urja Vikas Nigam Ltd for the transfer. The MoU included transfer of four 250 mw units of the Chhabra plant to NTPC in the first phase and transfer of two 660 mw units after commissioning.