In midst of signing fuel pact for Butibori plant: Rel Power

Reliance Power (Rel Power), the power generation arm of the Anil Ambani-led Reliance Group, has posted around 17 percent year-on-year jump in FY13 net profit to Rs 1011.46 crore. Sales also rose almost three-fold to Rs 4927 crore as plant availability rose to 92 percent from the earlier 86 percent.

JP Chalasani, Rel Power's chief executive in an interview to CNBC-TV18 said that its power generating asset in its flagship Rosa project generated 8 billion units in the year gone by from 4.3 billion units YoY.
However, production hault at Rosa toward the end of the year due to payment-related issue with the Uttar Pradesh Power Corporation did not impact company financials.
Chalasani further said that currently there are no coal supply issues at Rosa plant and if there are any, the firm imports it.
Talking about fuel availability at its Butibori plant, Chalasani said the firm has banked coal on an e-auction basis and it is also in the process of signing the fuel supply agreement with Western Coalfields Limited (WCL) for both the units at the concern plant and once it signs FSA, it will have sufficient coal to run operations and the balance would be imported. Read This: Reliance Power to generate 2,640 MW more at Sasan plant Below is the edited transcript of Chalasani's interview to CNBC-TV18.

Q: What were the key drivers for growth for you this quarter?
A: The all over operating plants, especially the Rosa plant as well as the solar plant has performed very well. That has contributed significantly towards our top-line as well as bottom-line. If one looks at the year as a whole, one can see that our generation got doubled compared to the last financial year. It moved up from about four billion to eight billion units and the revenue has almost got doubled. For the first time, we achieved a profit level of more than Rs 1000 crore. So, this is purely because of the excellent operational performance from our operating plants. Q: How has Rosa unit turned out this quarter?
A: Rosa has been the major contributor towards our profitability. One can see that even in the generation of around eight billion units, 95 percent of the generation came from Rosa itself. Therefore, most part of contribution came from Rosa as far as operating profits are concerned. Q: What about the interest cost situation, what are you doing to alleviate that problem?
A: Interest cost depends on more and more funds that one is deploying. It is a growing company and more and more funds that one deploys, obviously the interest cost keeps going up. That is the reason, nothing else.
_PAGEBREAK_ Q: On the plant load factor (PLF) front, how have you faired because there is some disappointment on how low the PLF has been this quarter?
A: What has been a significant factor more than the PLF is availability. This is because we get paid based on availability on this. The last quarter we had 103 percent availability in Rosa and this quarter we had 106 percent availability. That is the significant contribution. As far as PLF is concerned, for the year we clocked a 76 percent PLF. But one gets paid based on availability, so that is an important factor for us. Q: Any update on the Butibori plant and whether you have had any pre sales over there?
A: At Butibori we have the Power Purchase Agreement (PPA) with Reliance Infrastructure on a short-term basis for two years. Last year, because the plant was not ready, we actually outsourced this power and sold it to them. That is the reason we have another Butibori sale happening on this. Now, from this year onwards, one unit has been declared commercial and we are supplying to them from Butibori itself. Q: Could you tell us about recent developments in terms of getting fuel supply for both Rosa and Butibori?
A: As far as Rosa is concerned, whenever there is a short fall of domestic coal, we have been importing and maintaining the coal stock at Rosa and as we speak today, we have significant coal stock at Rosa for firing coal. So, there is no issue with respect to the coal availability for Rosa because we are allowed there to import the coal for the shortfall of linkage coal on this.
As far as Butibori is concerned, right now we have banked the coal on e-auction basis and we are in the process of signing the fuel supply agreement with Western Coalfields Limited (WCL) for both the units. Once we sign that, we expect the linkage coal to be available for Butibori like Rosa and the balance coal would be imported as domestic market coal.