Power producers seek more time to install emission controlling FDG technology

An association of power producers has sought more time to install emission controlling equipment at their plants, saying various issues, including Covid-19 followed by supply disruptions from China, have posed challenges in meeting the December 2022 deadline.

In a letter to the Prime Minister's Office (PMO), the Association of Power Producers (APP) has sought another three years to complete the process.

As per a government order, all thermal power plants in India have to install the flue gas desulphurisation (FGD) technology that reduces sulphur oxides emissions on the burning of coal, in a phased manner by December 2022.

In the letter, the APP has apprised the top office that under the current circumstances meeting the deadline would be a challenge as the Covid-19 outbreak has led to supply disruptions of equipment from China.

Only about 20-30 per cent of the emission-reducing components, it said, are manufactured in India and for a major share of 70-80 per cent, the country is dependent on imports from China, it said.

The risk of default has also increased due to impact of the disruptions caused by the pandemic and a growing clamour for the boycott of Chinese goods in the aftermath of the recent clash between Indian and Chinese troops, said the letter, a copy of which has also been sent to the Ministry of Power.

This is in addition to regulatory hurdles and reluctance of banks to take on additional exposure to the power sector in the face of uncertainty of cash flows arising out of the existing and new investments to install FGD, even while many of thermal power plants are awaiting large sums from discoms for period prior to August 2019, compounded now due to unprecedented pandemic...," the body said in the letter.

Coal-fired plants with capacities totalling over 166.5 GW have to comply with the regulation by December 2022, in a phased manner, it added. For 14,000 MW capacity in NCR (national capital region) the deadline was December 2019, which due to various reasons the players have already missed, it said.

Another 26,330-MW power capacities are required to set up FGD units in 2020, 64,268 MW in 2021 and 64,055 MW in 2022, the letter said adding that 77 per cent of the plants have not even yet awarded the contracts to install FGDs and ESPs (electrostatic precipitators).

Given the challenges and the situation in front of the players, APP said it requests "the government to push ahead the timeline by at least two-three years."