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Mumbai: The Maharashtra government has asked its electricity distribution company, the Maharashtra State Electricity Distribution Corporation (MSEDCL), to buy electricity from private gas plants to ensure uninterrupted power supply. Importantly, the plant has been shut down for the past five years, and at the same time, the state’s own uranium gas-fired power plant has been dormant due to gas shortages.
MSEDCL has expressed its reservations about the proposal, pointing out that its share in Mumbai is only 5 to 6 percent, and the government should ask the main suppliers in the city – BEST, Tata Power and Adani Electricity – to buy more power to face the problem. Possible shortages in the future. It also indicated that the decision of the state will result in an increase in electricity rates for electricity users throughout the state.
The city of Mumbai and its nearby suburbs experienced a power shortage on October 12, 2020. After that, several measures were planned to address the situation, which occurred due to a shortage of supply. On October 10 this year, the state power department wrote to MSEDCL, asking it to sign a power purchase agreement with Pioneer Gas Power Limited (PGPL) to purchase power for 15 years. PGPL has a 388 MW gas-fired power plant in Mangaon tehsil of Raigad district. The letter from the Department of Energy said: “The plant has not been operational for the past 5 years; Restarting operations will require three to four months.”
The order of the state power department has irked MSEDCL officials as well as energy experts. In response to the department, MSEDCL expressed reservations.
“In Mumbai district, MSEDCL’s demand (or share) is around five to six percent only,” read the letter. “Furthermore, MSEDCL has contracted sufficient long-term capacity with generators to meet its own needs in MMR and the rest of Maharashtra. Hence, MSEDCL is of the view that PPA with PGPL should be signed by all Mumbai utilities like Tata Power, BEST, Adani and Railways as per their share of load in Mumbai’s needs.” MSEDCL’s letter also sought attention to the fact that the power transmission project to import more than 2000 MW of power to Mumbai is nearing completion.
Energy experts have expressed concern over the power department’s proposal to sign a PPA with PGPL. “This country is already facing a gas shortage. Several gas-fired power plants were affected, and the remaining units were running at 40 to 80 percent of capacity. So we don’t understand why the power department is asking MSEDCL to sign a new PPA with the gas plant that was closed in the last five years. It will create a huge burden on energy consumers. Secondly, why should the energy consumers of the state be forced to pay for the island of Mumbai?” said energy expert Pratap Hogade.
Another expert, Ashok Pendse, raised the question. “Yes, MSEDCL has surplus power during normal times. So the new PPA will result in power consumers being burdened with bigger bills. It is the responsibility of the Mumbai Distribution Company, not MSEDCL,” he said. “Secondly, if the government is keen on operating gas-fired power plants, it should ensure full gas supply to the Uran gas-fired power plant run by government-run Mahagenco. The Uran power plant has a capacity of 672 megawatts but is currently generating only about 140 to 150 megawatts as APM is not available.”
When asked, the state-owned Maharashtra Holding Board said a cost analysis would be done before finalizing the deal. “As of now, there is no final decision on purchasing power from PGPL. MSEDCL is examining the proposal and will take a final decision after analyzing cost-related issues. And that decision will be subject to the approval of the Maharashtra Electricity Regulatory Commission,” said Vishwas Pathak, Independent Director of MSEB Holding.
State Energy Minister Abha Shukla did not comment.
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