Power transmission projects for connecting upcoming renewable energy capacities would take forward public-private-partnerships in the sector, Pratik Agarwal, CEO, Sterlite Power, said on Monday. “We expect Rs 3-4 lakh crore worth of transmission projects under the tariff based competitive bidding (TBCB) category in the next five years,” Agarwal added, while announcing the commissioning of the 414 kilometres long transmission project to augment electricity supply capacities to Jammu and Kashmir.
The aggressive target of having 175 giga-watt (GW) of renewable energy capacity by FY22 warrants major ramping up of transmission capacity. Company officials pointed out the need of more transmission lines, apart from the Union government’s ongoing green energy corridor scheme, to support renewable energy integration.
Inadequate transmission infrastructure has been a longstanding impediment to wind power developers, forcing the government to reduce capacities offered in the upcoming auctions by more than 50% to 1,200 MW. A 2,000 MW wind tender announced in April had also been cancelled due to this. The parliamentary standing committee on energy had noted earlier this year that the green energy corridor scheme has been a “non-starter”.
The private sector has been vocal about the government not awarding all transmission projects through TBCB and allocating a number of works to state-owned Power Grid Corporation of India — an allegation opposed by the central transmission utility. Till date, as many as 23 TBCB transmission schemes are under implementation and 14 have been commissioned. Only five of these have been completed on time.
“Commissioning the Kashmir project two months ahead of schedule testifies that the private sector is no longer reluctant to take up transmission projects through rough terrains and this should inspire the Centre and the states to take up more PPP projects,” Agarwal said.
The cost of the project is about `3,000 crore and the company expects to earn `437 crore annually on a levelised basis over 35 years.
When asked if competitive bidding would push bidders to quote unviably aggressive tariffs, as it happened in the power generation sector, Agarwal said that the power transmission industry is insulated from such adversities as mostly serious players participate in such auctions. “There should be severe penalties for project abandonment,” Agarwal said.