Power producers seek 3-year extension for installing FGD technology

• In a letter to the PMO, the body argued that the COVID-19 pandemic, followed by a disruption in supplies from China, have made it difficult to meet the Dec 2022 deadline

• For 14,000 MW capacity in NCR, the deadline was December 2019, which due to various reasons the players have already missed, the APP said

New Delhi: The Association of Power Producers has sought more time from the government for the installation of emission controlling FGD (Flue Gas De-sulphurisation) equipment at their plants on Friday. In a letter to the PMO (Prime Minister's Office), the body argued that the COVID-19 pandemic, followed by a disruption in supplies from China, have made it difficult for them to meet the December 2022 deadline. The association has, therefore, sought three more years to complete the process. It added that only about 20-30 percent of the emission-reducing components are manufactured in India and power producers are dependent on China for the rest 70-80 percent of the equipment.

The government has mandated power plants in the country to install FGD technology which reduces sulphur oxides emissions on burning of coal, in a phased manner by December 2022.

Pandemic & Boycott-China calls have increased risk of default: APP

The letter said that the risk of default has also increased due to the disruptions caused by the COVID-19 pandemic and a growing clamour for the shunning of Chinese equipment in the backdrop of the confrontation between Indian and China in Ladakh. A copy of the letter 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…," said the letter.

'NCR power plants have already missed the Dec 2019 deadline'

The association said that coal-fired power plants with capacities totalling over 166.5 GW have to comply with the regulation by December 2022, in a phased manner. 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 and added that 77 percent 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 requested "the government to push ahead the timeline by at least two-three years."

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