Ensuring Affordable Fuel Security for NTPC - Presentation

ENSURING AFFORDABLE FUEL SECURITYFOR NTPC

PRESENTATION OUTLINE

INDIA AND NTPC OVERVIEW

FUEL SECURITY ISSUES

ANALYSIS AND SOLUTIONS

CONCLUSION

Capacity Addition

Targets

78,700 79,690 79,200

54,964

0 0

11th Plan 12th Plan 13th Plan

Planned Actual

Projected,CEA

NTPC’s Share

Installed Capacity

NTPC Rest of India

Generation Capacity

205922 MW

43128 MW

250.63 BUs

733.87 BUs

On 31st March 2014,NTCP Annual Report

(Group)

5

2012~ 41 GW

43,108 41,184

15,740

731923355*

~47000

~85,000

Current capacity Underconstruction

Invited bids fromvendors

Feasibility ReportApproved

Total Basket

Basket of projects

Figures in MW

* FR approved for XII Plan / XIII Plan

NTPC Target 128 GW Capacity (

2032, 28% From Non-fossil Sources )

Coal

Gas

Nuclear

Hydro

Renewables81%

19%

56%

16%

11%

8% 9%

PPA signed for ~100,000MW

2032~ 128 GW

(Gigatonnes of coal equivalent 5),IEA

Global Fuel

Resources

Year XI FYP* XII FYP (Projected) XII FYP (Projected)

Demand 696.03 980.50 1373

Supply 554 715 950

Gap 142.03 265.5 423

CONFIDENTI*data in MT, Ministry of Coal

Coal – Demand &

Supply

Major Fuel Security Issues

Availability

Affordability

Accessibility

Environment Friendliness

Fuel Security Issues

AVAILABILITY

• Low productionNTPC has a short fall of 10%

• Outdated Mining Technology

• Captive blocks are way behindschedule.

AFFORDABILITY

• Rupee’s Fall


Grade CFR ($) Freight ($)

Ex-plot ($)

Discharge Port

Indonesian

5,500 69.5 12 4,350 Vizag

5,000 66 12 4,150 Vizag

4,600 59 12 3,750 Tuticorin

Australian

5,500 88.5 20.5 5,600 Gangavaram

$1=60 Rupee

ACCESSIBILITY

• Change in International PoliciesAmendments in coal mining and pricinginternationally, affects imports.

• Localized Reserves

• Inadequate Facilities At Ports

• Land Acquisition


Localised Coal

Reserves

ACCESSIBILITY

• Change in International PoliciesAmendments in coal mining and pricinginternationally, affects imports.

• Localized Reserves

• Inadequate Facilities At Ports

• Land Acquisition


Measures to Beef up Production

From Upcoming Mining Project :

Time frame clearance of coal mining projects.

Up front forest and environment clearance

Allocation of more coal blocks to private players/ end users with strictdeadlines and steep penalties for failure.

A special purpose vehicle (SPV) may be set up initially to take care ofall regulatory clearances, which is then transferred to the Minedeveloper

Coal Demand Supply Scenario forecast FY 14 FY 15 FY 16 FY 17

Coal Demand 187 198 205 218

On date supply 119 119 119 119

LoA / New Supply 22 25 32 38

Total Linkages 141 144 151 157

%age Demand 75 74 73 72

Balance to be Met(B)

Captive Production 3 8.5 19.5 37

E-auction 3 3 3 3

Total Domestic(A+B) 147 155.5 173.5 197

%age of Demand 79 79 85 90

Imports (Domestic equiv.) 40 42.5 31.5 21

Actual Imports 23.5 25 18.5 12.4

NTPC’s Coal Demand

Forecast

Strategic Solutions

Integrated approach

At time Options

Near Future Solutions

Long Term Strategy

Integrated Approach

49000

6000

20006000 2000

Coal Renewable Nuclear Gas Hydro

NTPC’s revised target portfolio for 2017 (MW)

Aim of integrated approach is to eliminate the share of imported coal from NTPC’s basket

• Ambitious foray in solar powersector taking advantage ofgovernment policies and subsidies.

• Setting up nuclear plants.

• Ensure gas supply by taking overassets abroad.

• Small hydro up to 200 MW in northeast, less problems than highcapacity hydro.

Import of coal.

E-Auction

Tie up through MOU at premium price.

To take up with CIL for finalization of FSA for new units at 90%commitment level

Transportation of coal through Inland Waterways at

Farakka/Kahalgaon/Barh

NTPC may contemplate handing over their own fleet of wagons toRailways for increased coal movement

At Time Options

Ganga- Bhagirathi-Hooghly National water way No-1

Kahalgaon

FarakkaBarh

Import of coal.

E-Auction

Tie up through MOU at premium price.

To take up with CIL for finalization of FSA for new units at 90%commitment level

Transportation of coal through Inland Waterways at

Farakka/Kahalgaon/Barh

NTPC may contemplate handing over their own fleet of wagons toRailways for increased coal movement

At Time Options

Near Future Solutions

• Development of allotted coal blocks.

• Acquisition of assets (Domestic and abroad).

Coal Mine acquisition abroad

• NTPC is exploring options for acquisition of coal mines in Indonesia,

Australia, South Africa and Mozambique

• Due diligence to coal in Indonesia is going on.

• ICVL – JV of NTPC, SAIL, RINL, CIL and NMDC has also been entrusted

responsibility of thermal coal mine acquisition abroad.

• CIL is also exploring options of acquisition of coal mines abroad. NTPC is in

discussion with CIL

Planning Long term Coal Security

Procure Low GCV coal so as to allow higher proportion of blending

• Issues of Infrastructure bottleneck:

Higher volume of coal import

Port Infrastructure bottleneck

Railway transport bottleneck

•Take part in Port Infrastructure Development and seek Railway support for transport of higher volumes

23

Strategy

Issues

Remedies

Coastal based projects running fully on imported coal

•Tariff calculations? (pass-through)

•Choosing projects to be relocated

•Coal pricing may be linked to CERC index or global coal indices

•Older projects of XII plan could be relocated

Retrofit existing boilers and change specifications of new boilers so as to allow for higher GCV coal usage

• Issues of high costs

•High Expenditure of retrofitting

• Impact on cost of generation

•Long term coal security

•Stations where retrofitting needs to be done is to be evaluated

CONCLUSION

INFRASTRUCURE DEV. & LINKAGE

RE ENGINEERED PORTFOLIO MIX

Queries?

Thank you

Ensuring Affordable Fuel Security for NTPC - Presentation

Engineering

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