Tata Power sheds 3.6% on inconclusive hearing at CERC
Private power producer Tata Power reversed its yesterday's 4 percent gains, losing as much as 3.6 percent intraday on Wednesday after an inconclusive hearing at CERC yesterday. The company reiterated its plea to establish an appropriate mechanism to offset adverse impact of the new coal price regulation by the Indonesian government.
December 05, 2012 / 15:24 IST
Private power producer Tata Power reversed its yesterday's 4 percent gains, losing as much as 3.6 percent intraday on Wednesday after an inconclusive hearing at CERC yesterday. The company reiterated its plea to establish an appropriate mechanism to offset adverse impact of the new coal price regulation by the Indonesian government.
Power sector regulator Central Electricity Regulatory Commission (CERC) will continue hearings next week on the plea by Tata Power for revision of tariff for electricity generated from its ultra mega power project in Gujarat. "The next hearing is on December 11," CERC Chairman Pramod Deo told reporters yesterday. Tata Power is setting up the coal-fired 4,000 MW project at Mundra through its subsidiary Coastal Gujarat Power Ltd. The company imports coal for the project from Indonesia and has been suffering from mounting losses as the fuel prices have gone up.However, the company cannot pass on rising cost of coal to end-consumers because the company has bid for the project at a price which cannot be increased for 25 years. The plant sources its coal from Indonesia, which revised the price of coal from its mines in September, last year, which resulted in hike in the cost of the raw material. In July, this year, Tata Power filed a petition with CERC asking for a tariff hike for its Mundra project.The company is seeking higher tariff for electricity generated from the plant, which would help mitigate losses arising out of costlier imported coal. Tata Power has commissioned the third 800 MW unit at Mundra project, taking its overall generation capacity to 6,899 MW. Two units - 800 MW each - of this plant were commissioned earlier this year.Meanwhile, the company is also looking for additional mines in Australia, Mozambique, South Africa and Indonesia for Mundra UMPP. The project needs about 10 to 12 million tonnes of imported coal per annum.At 14:31 hours IST, the stock declined 3.3 percent to Rs 108.05 amid high volumes.Also Read
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