NTPC to more than double capacity, power tariffs to rise as well
business Updated: Jun 07, 2016 06:41 IST
NEW DELHI: State-run power generation company NTPC on Monday said the company will add 4,500 megawatt (MW) of capacity in 2016-17, more than double the 2,200 MW added in 2015-16. But since the hike in coal prices would increase the cost of generating power, it would also mean a 8-paise rise in power tariff.
Coal India (CIL) plans to raise its revenue margin by an additional ` 3,234 crore by increasing average coal prices by 6.29%. The move is set to boost power tariffs across the country.
NTPC is also looking to modernise its old plants, chairman and managing director Gurdeep Singh said. “We need to de-commission old plants for retro-fitting. This will involve cost and time. There will also be a tariff hike of 50 paise for this. We know tariff is a sensitive issue and we will ensure that the new plants are commissioned before old ones start getting repaired.”
The company also said it does not have enough cash reserves to go in for buyback of shares.
“We have about 24,000 MW of projects under construction, which requires Rs 1,00,000 crore of capital expenditure,” said Kulamani Biswal, director, finance. “Therefore, our capital expenditure plans are also quite high and we don’t have idle cash. As of now, neither do we have any formal communication on a buyback nor do we plan to go for any buyback of shares.”
As of March 31, 2016, the company’s cash reserves stood at around Rs 4,000 crore. It incurred a capital expenditure of Rs 25,737.59 crore in 2015-16, against the targeted Rs 23,000 crore. For the current fiscal (2016-17), the company has earmarked Rs 30,000 crore.