One-size-fits-all approach to resolve power stress not viable: Tata Power's Sardana

Although the government in its effort to fulfil its promise of power for all 24x7 is looking at coal linkages, the sector per se is still bogged down with largest number of NPAs.

The NPA issue could be because of unviable PPAs signed at unviable high coal block costs or non-existent PPAs in the last two years. All this resulted in power producers and their lenders being caught in between the rock and a hard place.

To know if the coal linkage policy in comparison to the earlier allocation of coal blocks is better from a corporate perspective, and outlook for the sector going forward CNBC-TV18 spoke to Anil Sardana, Managing Director and CEO, Tata Power.

According to him, allocation of coal blocks failed because of the way bids were received. Moreover, there were a lot of projects under PPA that were build but had no coal allocation, so for them coal linkages were essential, he said.

Both the coal blocks and coal linkages have their own requirements and so have to go concurrently, he said.

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Anil Sardana

MD|Tata Power

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On the stress front, he said there cannot be one-size-fits-all approach to resolve all power stress. There is need for tailor-made solution for each standard asset, he added.

The sad part about stress is, good assets are rusting because projects are stalled, he said.

Talking about bidding for the revenawble energy space, like solar, he said some companies have been over aggressive with their bids in solar power projects but it would be desirable if bidders show restraint and learn from the past.

However, maybe these aggressive bidders have strategies in place to make low tariff projects viable, he added.

For more, watch video.