Power demand: NTPC to generate 5,000 MW through gas-based plants in April-May

Representative image.

With the peak power demand expected to hit 229 gigawatt (GW) in April, the power ministry has directed its public sector undertaking (PSU) NTPC Limited to operate and generate all its gas-based power plants to full capacity for a month, Alok Kumar, secretary, Ministry of Power told Moneycontrol.

“We have asked NTPC to generate 5,000 MW from its gas-based power plants for a month from April 15 to May 15. The gas supply for the same has been arranged,” said Kumar.

GAIL (India) is going to supply power to NTPC and the quantum that would be required is going to be about 248 Metric Million British Thermal Units (MMBtu).

The state-run power generator has 4,017 MW of gas-based capacity in Uttar Pradesh, Gujarat, Rajasthan, Kerala and Haryana. Another 2,494 MW capacity is through its joint ventures or subsidiaries.

“These gas plants normally run on peak load hours. They can immediately start and go to full load in 25 minutes. So, they can run for 2-3 hours and again stop. The tun-on and turn-off time is much faster than coal-based power plants,” said an NTPC spokesperson.

Now that the high price-day ahead market (HP-DAM) has been approved and will be launched by mid-March by Indian Energy Exchange (IEX), the power generated from these gas-based plants will be sold in the HP-DAM as its cost is going to be higher than Rs 12 per unit. The price ceiling in HP-DAM is Rs 50 per unit.

Despite it being costly power, the move will help states secure electricity supply in their regions during emergencies in the peak summer months.

India has about 25 GW of gas-based power capacity but almost 14 GW are not operational. Many gas-based power units have been idle or operate at low capacity due to their inability to secure fuel.

Deepesh Nanda, chief executive officer of GE Gas Power, South Asia, said India should take advantage of lower natural gas prices by signing long-term supply pacts in the current quarter to secure its energy needs. “The Indian government needs to strike long-term agreements with countries like Qatar, the US and Australia, and see if we can get relatively low-cost natural gas,” Nanda told Moneycontrol in an interview.

In the summer of 2022, a shortage of coal coupled with high power demand due to scorching temperatures led to a power crisis in the country. In December, the government asked state-run GAIL (India) and NTPC to increase imports of natural gas to supplement power generation.