No load-shedding: MSEDCL to buy 760 MW from Tata Power to meet summer demand

Load Shedding
Load Shedding

Nagpur: Faced with power crisis and load-shedding looming large, the Maharashtra State Electricity Distribution Company Limited (MSEDCL) on Friday decided to purchase 760MW power from Tata’s Coastal Gujarat Power Limited (CGPL). The purchase would be made till June 15 through a short-term power purchase agreement, according to reports.

Due to rising gaps in availability and supply of power, the State Government has allowed MSEDCL to purchase power from Tata Power’s Mundra plant. The deal would help in No load-shedding bridging the gap to some extent due to sudden surge in power as a result of early onset of summer season.

According to MSEDCL, power demand has crossed 28000 MW even as State-run generating companies are struggling with low stock of coal. On Friday, Maharashtra Government allowed MSEDCL to purchase 760 MW of power till June 15. By that time monsoon is expected to start and the power demand would stabilize.

No load-shedding- The State Energy Minister Nitin Raut, talking to media after the Cabinet meeting, said that even if there’s a power shortage in the state, load-shedding will not be resorted under any circumstances by purchasing power. The Nagpur Guardian Minister said power demand has shot up due to the intense heat wave in the state. Coal stocks are also depleting, and railway rakes are not available many times. “We have to store coal reserves for the monsoon. With the removal of all Covid restrictions, all industries and commercial establishments are operating at full capacity. Farmers’ demand has also surged due to the sweltering heat. As a result, the demand is constantly increasing and has reached 28,700 MW,” he stated

Justifying the decision to purchase power, the Minister said that instead of buying electricity at Rs 12/unit in the open market, the government has decided to overcome the shortage by purchasing CGPL power at half the rate. “The purchase will be done for the next two and a half months at a cost of Rs 100-150 crore to MSEDCL. This will not put any burden on the exchequer. The government entered into a long-term power purchase agreement with CGPL in 2007. The same company has entered into power supply agreements with Gujarat, Rajasthan, Haryana and Punjab. The power plant generates electricity via coal imported from Indonesia.”

The Minister added that MSEDCL distributes 87% of the total electricity consumption in the state. “Due to summer, the highest demand has reached 28,489MW. This is an increase of 8.2% over the previous year. At present, there is a shortage of 3,500MW-4,000MW in the state,” he said, adding, the decision of the Indonesian government led to a huge surge in the price of imported coal.